Any SRO For Mutual Funds Must Protect Competition, Says ACLI
By
Washington
Any proposal to establish a self-regulatory organization for mutual funds should contain protections against anti-competitive behavior by the SRO, says the American Council of Life Insurers.
The issue involves the possibility that the Securities and Exchange Commission will consider establishing an SRO for mutual funds.
A recent article in the Wall Street Journal suggested it, but there is no direct, formal statement from the SEC.
The only SEC comment is contained in its Daily News Digest of Jan. 28, where it says that during the Commissions Feb. 4 meeting, it “will consider a recommendation to seek comment on other ways to involve the private sector in fostering compliance by investment companies and investment advisors with the federal securities laws.”
Carl Wilkerson, chief counsel for securities with the Washington-based ACLI, says the experience with the National Association of Securities Dealers, which operates as an SRO for broker/dealers, shows that it is heavily skewed toward full service broker/dealers to the detriment of limited service broker/dealers affiliated with insurance companies.
If there is an SRO proposal for mutual funds, Wilkerson says, ACLI will be monitoring it closely to assure it has strong protections against anti-competitive conduct.
Chris Wloszczyna, a representative with the Investment Company Institute, Washington, says the issue of establishing an SRO for mutual funds comes up from time to time.