Rep. Paul Gillmore (R-Ohio) has introduced a companion bill in the House to the Mutual Fund Reform Act sponsored by Senator Peter Fitzgerald (R-Ill.) in the Senate. A companion bill is similar or identical to another piece of legislation introduced in the opposite house of Congress. Fitzgerald's bill aims to ban 12b-1 fees and improve disclosure on mutual fund fees so that consumers can more easily compare what they pay for competing funds.
Fitzgerald's office indicated the Mutual Fund Reform Act has been gaining steam, recently garnering the support of prominent Sen. John McCain (R-Ariz.). However, it has been stalled on the floor of the Senate for some time. Sen. Richard Shelby (R-Ala.), chairman of the Senate banking committee, has been a major roadblock to the legislation. He has vowed to allow reforms in the mutual fund industry to come from its regulator, the Securities and Exchange Commission, and not from Congress, at least for now.
With Congress approaching its summer recess and Fitzgerald planning to retire after his term is concluded, there remains little time for this bill to get going under his watch.
The reasons can vary as to why a bill would be introduced in both houses, but one possibility is to expedite the approval process. Another possibility is to garner support for the legislation in both houses to try and exert a little political muscle or pressure on opponents.
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