The Securities and Exchange Commission has taken some positive steps in examining mutual fund companies but more could be done, according to a Government Accountability Office report released Tuesday.

The GAO stressed in particular that the failure to detect trading abuses stemmed from the SEC's focus on other activities, which the Commission believed presented higher risks. The GAO recommended several ways by which the SEC could keep tabs on compliance issues at mutual fund companies: conducting independent assessments of controls in areas such as market timing; developing its capacity to identify and evaluate evidence of potential risk; and ensuring the independence of company compliance staff.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.