Eliot Spitzer wants to make sure the mutual fund industrys laws get changed. So hes going to the epicenter of where laws get changed: Washington D.C. There, the New York attorney general will take the industrys annual $70 billion in fees to task.
"Fund directors do not and cannot negotiate hard on fees," Spitzer will tell Congress, according to a published transcript of Spitzers speech. "What else would you except when the chairman of a mutual fund is also the chairman of the advisory company?"
And while some executives in the market timing probe have said that the illicit arrangements could not have been detected because they were made through surreptitious e-mails, Spitzer is planning to say that had directors been vigilant, they would have been suspicious of the wild swings in assets.
Spitzer also plans to expose the $50 billion in advisory fees and $20 billion in management fees that funds took in last year and call attention to estimates by
"One of the main messages will be that our office will not sign off on any settlement that doesn't include reform measures," said Spitzer spokeswoman Juanita Scarlett.
Spitzer already has some backing in Washington, as his probe has prompted a similar calls for reform from the
For its part, the
