Regulation

The SEC has proposed new rules to protect auditor independence that will place new responsibilities on mutual fund companies.

The SEC has charged Founders Asset Management LLC of Denver with defrauding its clients in a soft-dollar arrangement with an investment advisor, according to an SEC filing. The commission has issued $790,000 in fines against the firm and Bjorn Borgen, its former president.

NEW YORK - While there are no clearly defined compliance standards for best execution trade practices, firms that do not use electronic commerce networks to conduct any of their trades raise SEC concerns, according to an SEC official.

BOSTON-The SEC is concerned that increasing competitive pressures the mutual fund industry faces could lead it to engage in misleading or overly aggressive advertising, said Paul Roye, director of the SEC's division of investment management.

A suit charging that New York Life Insurance Co. breached its fiduciary duty as a sponsor to two pension plans and two 401(k) plans, is entirely without merit, the company said in a statement issued prior to the suit's filing.

BOSTON - The SEC is considering amending its proposed rules on independent directors to relieve directors' relatives from SEC scrutiny, said Paul Roye, director of the SEC's division of investment management. Roye spoke at a meeting of the American Law Institute and the American Bar Association here recently.

BOSTON - In a study examining mutual fund fees, the General Accounting Office has criticized the mutual fund industry and the SEC for not monitoring fees more closely, according to Geoff Bobroff, president of Bobroff Consulting, of East Greenwich, R.I.

James Mehling, a former vice president of New York Life Insurance Company in New York, last week filed a class action lawsuit, charging that New York Life improperly shifted assets held in both a company-sponsored pension plan and a 401(k) plan and used them as seed money for new proprietary institutional mutual funds.

The SEC will review the auditor independence rules of the top five accounting firms, the SEC has announced.

Wolf Haldenstein Adler Freeman & Herz LLP of New York has filed a class action lawsuit in New York Supreme Court against Prudential Securities and affiliates of the AEGON group of companies on behalf of investors who purchased annuities used to fund qualified retirement plans.