In an effort to further strengthen the effectiveness of mutual fund boards, the Investment Company Institute added two recommendations to its "15 best practices" platform: prohibition of close family members of fund employees, and audit requirements mirroring those set forth for companies by Section 301 of the Sarbanes-Oxley Act.

The ICI suggested that fund companies should implement these practices before any type of regulation by the Securities and Exchange Commission. The mutual fund industry has come under scrutiny for questionable trading tactics, especially from New York Attorney General Eliot Spitzer and his sweeping probe.

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