Compliance

The Securities and Exchange Commission is apparently close to starting a review of fund rules. However many industry observers are unsure which rules might be affected, and how fund marketing might be affected in turn.

The Securities and Exchange Commission's caseload was decimated by the terrorist attack on the World Trader Center, the home of its New York offices.

Prudential Financial has appointed Scott Sleyster, the president of its guaranteed products unit, to head the company's retirement services business.

Harvey Pitt has not even been formally sworn in as chairman of the Securities and Exchange Commission, yet already some industry observers are concerned that mutual funds may take a back seat once he takes the wheel.

A House subcommittee approved the Retirement Security Advice Act Thursday afternoon, prompting its proponents to insist that the House will pass it by year's end. It was the quickest markup of a bill in the history of the Committee on Education and the Workforce, lasting a short six minutes. But brewing far from the corridors of those meeting halls is an opposition that hopes for the bill's demise in the Senate.

The reason behind the recent proposal of the New York Stock Exchange to limit how much investment companies can pay in closed-end listing fees is not clear, but chances are it's not out of kindness.

The Investment Company Institute's call last week for less portfolio holdings disclosure is probably the best indication that the Securities and Exchange Commission is getting ready to increase disclosure requirements, according to industry observers.

This year's Morningstar conference began with the issuance of a challenge to the fund industry by Morningstar managing director Don Phillips to improve investors' experience with mutual funds.

Hearings are expected to commence soon on a new bill that would allow retirement plan providers to offer advisory services to plan participants, something that is largely prohibited now. Representative John Boehner (R-Ohio), chairman of the House Committee on Education and the Workforce introduced the bill, called the Retirement Security Advice Act, last month.

An NASDR arbitration panel has ruled against Franklin Templeton of San Mateo, Calif. in an arbitration case filed in 1999 against the fund adviser by Daniel Calabria, a former fund executive.

The Securities and Exchange Commission has shut down two illegally run mutual funds and the FBI seized records and data from the Linville Group, the company that ran the funds, according to a SEC official.

A district court judge in Connecticut issued an emergency order earlier this month freezing the assets of Ian Renert and Hawthorne Sterling & Company, an unregistered investment adviser in Wilton, Conn., according to the SEC.

Putnam Investment Management of Boston has settled a lawsuit brought against the firm's top executives as well as its mutual fund trustees by The Commerce Group, an insurance holding company in Webster, Mass.

Although the 401(k) market appears saturated and assets shrank in 2000, new legislation recently passed in Congress should bring in new assets, requiring fund companies to double their efforts at marketing to plan sponsors, according to analysts in the retirement industry.

WASHINGTON, D.C. - The Securities and Exchange Commission may drop a new rule requiring funds to report after-tax performance figures if a proposal to allow investors to defer a portion of capital gains taxes on their fund investments becomes law, said Paul Roye, director of the SEC's division of investment management.

Washington, D.C. - The possibility that actively-managed exchange-traded funds could cause market volatility is one of the issues to be addressed in a concept release' that the Securities and Exchange Commission expects to issue in the next few months, according to Paul Roye, director of the SEC's division of investment management. Roye discussed the SEC's active exchange-traded fund concept release at the general meeting of the Investment Company Institute of Washington D.C. here earlier this month.

New rules issued last week by the Securities and Exchange Commission outlining bank exemptions to the Gramm-Leach-Bliley Act may have important implications for the fund industry, particularly for no-load fund fees.

A no-action letter issued by the Securities and Exchange Commission last month gives some evidence of how the SEC views affiliated transactions with regard to fund companies, according to Alan Rosenblat, a lawyer with Dechert of Philadelphia. The issue of affiliated transactions is one the Investment Company Institute of Washington D.C. has sought guidance on from the SEC for some time, according to Rosenblat.

It is too early to speculate what impact Harvey Pitt, President Bush's designee for chairman of the Securities and Exchange Commission, will have on the mutual fund industry. Those assessments will only come after the corporate lawyer begins to take action on what will be a full agenda, according to analysts.

Harvey Pitt has been selected by President Bush as the new chairman of the Securities and Exchange Commission, according to a report last week in The New York Times. However, the SEC and the White House would not confirm that report.