NEW ORLEANS – Regulators at the Investment Company Institute’s Operations Conference here said they will be focusing more on electronic communications and management’s attitude towards internal controls as they go forward, in an attempt to be more proactive when examining firms.

As investor confidence has broken down, Securities and Exchange Commission Chairman William H. Donaldson has preached to the financial services community to change the "tone at the top," meaning management’s attitude. However, the initiative to legislate attitude left some attendees skeptical as to the practicality of such a task. John Walsh, chief counsel of the office of compliance inspections and examinations at the SEC, along with the rest of the panel on "How to Prepare For an SEC Examination," made it clear that Donaldson’s warning was not just rhetoric or done for appearance sake.

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