The McGraw-Hill Companies of New York, parent company of Standard & Poor's, filed a lawsuit against Vanguard Group of Malvern, Pa. charging that Vanguard breached the 15-year-old licensing agreement it had with S&P by registering a new class of exchange-traded shares on three of Vanguard's equity index funds without the index creator's approval.

An SEC administrative law judge has sanctioned two executives of the now defunct Target Income Fund of Glendora, Calif. for their role in filing registration statements on behalf of the fund that failed to include significant facts.

WASHINGTON - The Securities and Exchange Commission will continue to scrutinize the sale of bonus annuities and could issue clarification of or additional rules for the products, according to commission officials.

Claims that the Investment Company Institute is violating federal securities laws are a legal longshot, according to mutual fund industry lawyers.

The Investment Company Institute is violating federal securities laws by collecting membership fees from mutual funds while allowing the organization to be dominated by mutual fund advisory firms, according to a lawsuit two shareholders filed against the trade group last week.

The SEC plans to issue the first in a series of legal bulletins on investment adviser advertising practices by Dec. 31.

WASHINGTON - The SEC should increase its scrutiny and possibly its regulation of investment accounts that may behave like mutual funds but are not required to abide by the same legal requirements as funds, according to the Investment Company Institute.

The SEC has used a low-profile closed-end fund case to make a point about the powers of fund directors and highlight the value of having independent lawyers advise fund directors.

The SEC will not judge whether economies of scale are being passed along to fund shareholders in the form of lower fees in a report the agency expects to issue this summer.

NEW YORK - A rule proposal outlining how mutual funds should report their after-tax returns should be revised to make it less confusing to investors, said Joel M. Dickson, a principal with The Vanguard Group of Malvern, Pa.

NEW YORK - The changing regulatory environment in the mutual fund industry has created ambiguous legal standards that require fund advisers to establish new procedures to protect themselves from enforcement proceedings, said industry lawyers.

It might be called the triple crown of regulatory malfeasance.

BOSTON - The SEC's goal of providing final rules regarding director independence by this summer could be in jeopardy.

Dreyfus Corp. agreed May 10 to pay nearly $2.7 million to settle charges related to how it allocated and disclosed its practices on initial public offerings for the Dreyfus Aggressive Growth Fund.

A former SEC lawyer and the Consumer Federation of America are employing a little-used tactic that could compel disclosures by fund companies unheard of in recent years, according to fund industry lawyers.

The SEC is considering changes in a proposal - strongly opposed by some fund companies - designed to stop firms from contributing to government officials in an effort to win business managing government employee pension plans.

Two mutual fund shareholders are challenging the constitutionality of a two-month-old Maryland law designed to define what makes a mutual fund director independent.

The SEC's office of compliance, inspections and examinations, in a letter May 1 to investment advisers, has identified 12 areas of potentially troubling practices that the SEC expects to review during exams. The letter, which largely tracks speeches top compliance office officials have made this year, outlines advisers' duties regarding advertising, personal trading, soft dollar disclosure and other issues. It also offers examples of instances of violations the office has found.

The Canadian fund industry is lobbying against new securities regulations that require mutual fund prospectuses to compare past performance to market benchmarks. The mandatory references to market indexes are among the more controversial aspects of the legislation, National Instrument 81-101. The sweeping new rule took effect on Feb. 1 and is coming into force gradually this year as fund companies revise their prospectuses and introduce new funds.

Mutual funds and custodians have until next year to comply with new federal securities rules designed to insure that fund securities held abroad are properly safeguarded.