Regulation

A recently enacted Maryland law that makes it more difficult to challenge the independence of fund directors in court is under attack.

The SEC may be overdoing it in its preparations for the computer-programming transition to the year 2000, according to some mutual fund operations executives.

The process of valuing the securities in a mutual fund's portfolio - often an imprecise task - may require more work from now on for some fund companies and fund directors.

Deep Discount Advisors of Asheville, N.C. has sent a protest letter to the SEC charging that the Global Small Cap Fund of New York is trying to prevent Deep Discount from introducing a proxy vote to elect a new slate of directors for the fund.

The SEC is expected to issue guidance soon on how mutual funds should value their securities, an issue of critical importance to the fund industry that the SEC has not systematically addressed in more than 25 years.

A couple of new mutual fund companies have done what could be a risky maneuver - launching a website that mentions a fund before the fund has been approved by the SEC.

The SEC has finalized amendments to a rule which governs the appointment of an interim investment adviser to a mutual fund. The rule clarifies the procedure to be followed when there is a merger of a fund's investment adviser. The revised rule 15a-4, originally adopted in 1980, permits a fund to be advised under a short-term contract until shareholders can vote on a new contract.

Mutual fund shareholders next year could begin seeing the expenses associated with running their funds decrease by millions of dollars as the result of recent moves by the Securities and Exchange Commission.

Two top executives at Sunpoint Securities, a broker/dealer of Longview, Texas, allegedly diverted up to $25 million from as many as 9,000 clients during a nearly two-year period, the SEC alleged in a lawsuit filed Nov. 19.

The SEC, alleging a portfolio manager stole approximately $5.8. million from the funds he managed, has sued the manager who has already spent seven months in jail on related charges.