PALM DESERT, Calif.-Norm Champ, director of the Securities and Exchange Commission's Division of Investment Management, last week took the first steps in meeting and speaking with members of the Investment Company Institute.
Champ, sporting a SoCal sunburn, delivered the keynote at the ICI's annual Mutual Fund and Investment Management Conference here.
He spoke of the agency wanting to enhance its "eyes and ears" by "getting a better and more first-hand understanding of the workings of the fund industry" via the Division of Investment Management's new Risk and Examinations Group or "REG."
"As part of REG's early-stage work, REG staff and I have been meeting with senior managements and fund boards from some of the largest, or most strategically important, fund complexes. We intend to visit firms of all sizes. The Office of Compliance Inspections and Examinations, or OCIE, is doing most of these visits with us and is focusing its efforts on the largest firms," said Champ.
Mutual fund directors take heed because Champ says his division will be focusing on you.
"There are a number of issues we hope to discuss with fund directors. Are fund directors overextended? Are fund directors' responsibilities appropriately allocated? Do fund directors spend time on the issues where they can provide the most value?" he asked.
Champ also said his unit has recently met with accounting firms, ICI staff and ICI members concerning valuation and is working on valuation guidance that it can recommend to the SEC.
On the exchange-traded fund front, Champ said federal regulators would "like to codify exemptive relief" from provisions of the Investment Company Act of 1940, in order to be able to focus on the more innovative forms of exchange-traded funds and other investment fund applications in the future.
This would allow his division, which acts as the "laboratory of the SEC as far as asset management" is concerned, to focus on applications to create "innovative products" as opposed to "plain vanilla products,'' he said, in a panel discussion.
That's quite a laundry list and one that the SEC hopes it can clean and freshen up, with the help of the membership of the ICI.
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