Investors Should Wait for More Details From Fund P

Oct. 27, 2003 — In response to New York Attorney General Eliot Spitzer’s ongoing investigation of market-timing and questionable trading practices at certain mutual fund companies, Standard & Poor’s is cautioning investors to wait for further information before taking any action.

In a statement issued Monday, Phil Edwards, managing director for Standard & Poor’s fund research, noted that “much still remains to be learned about the breadth and depth of this investigation,” and that we may, for example, “learn more about any role played by intermediaries and distribution channels.”

While giving advantage one set of investors over another is wrong and should not be excused, Standard & Poor’s also said changes in the industry are already being widely discussed, and that it strongly believes management of the fund sponsors must lead these changes. Only by demonstrating rapid and decisive leadership will fund sponsors restore the public’s confidence in their products and services.