eporters covering the fund industry are going to have put off an annual shindig with the ICI thanks to events unfolding in Washington. Rather than wine and dine reporters at the "21" Club in Manhattan, the ICI has invited new organizations to send reporters to Michael Oxley's
hearings on Capital Hill.
The "21" Club lunch is an annual event the ICI puts on to introduce reporters to fund industry leaders. This year, the event was set for this coming Wednesday. It just so happens that Oxley scheduled the hearings on fund fees in his House Financial Services subcommittee for the same day.
The ICI responded to the unlucky timing last week with an email to reporters stating that the lunch had been postponed until May 22 to allow Paul G. Haaga Jr.
to appear before the House Capital Markets Subcommittee to deliver testimony during the subcommittee's hearing on mutual fund industry practices and their effect on investors.
The ICI added that Matthew P. Fink
will hold a media briefing in Washington at the National Press Club at 8 a.m. before the event.
The day could be a long one for Fink, Haaga and the rest of the fund industry. Part of the hearing may cover the NASD-SEC-NYSE's look into whether breakpoints are properly recognized for fund investors. The complete report is expected this week and could be out in time for the meeting, reports Dow Jones Newswires today.
The report found that nearly all of the nearly 40 brokerage firms investigated by the NASD had problems applying the discounts, according to sources that have seen the draft of the report. The news organization adds that the problems were severe enough for the regulators to be considering a more extensive look into the issue.
The good news in the report is that is suggests that the failure to recognize the discounts is mostly a matter of brokers and customers failing to communicate -- not an attempt by the industry to defraud investors. Be thank for small things, but forget about the free lunch.
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