WASHINGTON - The SEC should increase its scrutiny and possibly its regulation of investment accounts that may behave like mutual funds but are not required to abide by the same legal requirements as funds, according to the Investment Company Institute.

Technology and the Internet may make it possible for sponsors to create "virtual mutual funds" online, products that have many of the same features as funds but now are exempt from the key federal law that governs funds, according to Craig Tyle, general counsel of the ICI. Such virtual funds could be mass marketed, a fact that poses a potential peril for investors, according to Tyle.

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