Funds and Games

Financial Planning, July, 2007 by Marshall Eckblad

The Securities and Exchange Commission has been grumbling about mutual fund reform for months, promising a renewed look at the independence of fund boards, the chaotic presentation and delivery of prospectuses and, most prominent, how 12b-1 fees are used. Of all these pots simmering on regulators' stoves, none seems more ready to boil than the issue of 12b-1 fees.

In March, Andrew Donahue, the director of the SEC's division of investment management, promised to address the problem before the year's end. The Investment Company Institute (ICI) in Washington reacted by "commending the SEC for taking a fresh look at the issue," says ICI spokesman Michael Shore. Interested parties from across the industry are preparing for a June 19 SEC roundtable meeting to discuss 12b-1...

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