Conflicts of Interest, Excessive Fees Top of Regulators' Minds

Executives at investments firms have a new set of priorities in 2005 compared to the ones they had at the end of 2003, according to recently released research by TowerGroup.

In the last year and a half, many regulatory issues such as e-mail storage and mutual fund scandals have continued to weigh on executives' minds. Still, in 2005, executives have begun focusing on a different set of issues, as well. For instance, conflicts of interest and excessive fees, operational control areas, and soft dollar payments were found to be fresh topics that executives considered important in 2005.

Compared to this, in 2003, executives had been mulling over the USA Patriot Act, privacy laws, offshore outsourcing and capital adequacy requirements. Now, with a Securities and Exchange Commission that is better equipped with technology, and has become more proactive in hunting for wrongdoers, firms need to center their business models on bolstering internal checks and balances.