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Compliance March 5, 2004
SEC Examines Fund Surveillance
March 5, 2004 (PLANSPONSOR.com) - US Securities and
Exchange Commission (SEC) Chairman William Donaldson is
looking at changing up the way the $7 trillion mutual fund
industry is monitored by the agency.
Reported by Eric Hazard
>Donaldson has commissioned a task force to examine how often mutual funds provide reports to the SEC and the kinds of information they provide. Additionally, the task force will inspect how to use new technologies to enhance oversight of mutual funds, according to a Dow Jones report.
Of particular interest to Donaldson is the role hedge funds are playing in the mutual fund trading scandals peppering financial page headlines. Donaldson acknowledged that much of the news in the past year has been “downright depressing,” but found that hedge funds were often active participants in market timing and late trading schemes.
All of the concerns about hedge fund involvement in the improper mutual fund trades has led to the SEC staff considering recommendationsrequiring hedge fund managers be subject to SEC oversight. Donaldson said the SEC will seek comment on that idea from all interested parties before voting on any changes in hedge fund regulation.