Regulation of the securities industry is a never-ending story, and Securities and Exchange Commission's Chairman Christopher Cox is like the energizer bunny. He keeps 'going and going and going,' according to an interview that Investment Company Institute President Paul Schott Stevens had with sister publication Securities Industry News.

In 2003, the market-timing and late-trading scandals set off the current regulatory trend. This period was one of the most active periods of regulatory activity.

Chairman Cox is not totally finished patching up the industry, Stevens said. The ICI president expects Cox to keep moving forward with time-stamping methodology "so there will be an audit trail after the fact," he said. "Remember the market-timing scandal was also a broker/dealer and hedge fund scandal. It did not just involve mutual funds."

In his interview, Stevens promoted online disclosures and delivery of prospectuses as a way to "empower investors" through Internet tools.

He also commented on the redemption fee rule, and the fact that the ICI hopes that Cox will move rapidly in regards to it.

In regards to the SEC's recent rule requiring hedge funds to register, Stevens said, "The rule itself has significant implications, but it does not apply across the board. For example, a fund does not have to register if it locks up investors' money for a period of time. The rapid rise of the hedge fund sector raises issues that the SEC will only be able to come to grips with over time. Registration is a constructive first step. Our focus is on registered investment companies.

As of now, the SEC has a few rules pending, such as point-of-sale disclosure, and Stevens gives Cox credit in the area of executive pay disclosure and the way that the SEC plans to approach the penalties.

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