PALM DESERT, Calif. – Sounding the familiar cry that the fund industry has done a good job or persevering through a "grinding bear market" and "egregious corporate scandals," Matthew Fink, president of the Investment Company Institute, also said that enough regulation is enough.

Just as technology valuations got out of hand, there is the danger of a "regulatory bubble," Fink told mutual fund executives gathered here for the 2003 Mutual Funds and Investment Management Conference, sponsored by ICI and the Federal Bar Association.

Fink was alluding to the passing of the Sarbanes-Oxley Act and recent scrutiny of industry practices by the Securities and Exchange Commission and the House Committee on Financial Services.

Roye also warned against subscribing to the herd mentality in terms of marketing the hot product, as opposed to doing what is best for the investor. "Fund organizations must have a conscience," he said.

Paul Roye, director of investment management at the SEC, called for a "new era of accountability" in which the fund industry should take a leadership role in restoring investor confidence. He accused the ICI of asking the wrong questions regarding compliance issues and being too wrapped up in what other industries are doing. He asked that executives, auditors and other key players stop passing the buck when it comes to identifying breakdowns in the system. Recalling an old adage, Roye said, "When you point your finger at someone, your other four fingers are pointing at yourself," in a direct barb at Fink.

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