“The securities industry is committed to improving the clarity of information given to investors,” said SIA’s Chairman Richard E. Thornburgh, the chief risk officer for Credit Suisse Group and a member of the Credit Suisse Group Executive Board.
“We look forward to working with the NASD, as we have done in the past in resolving issues, for example, about breakpoints. The industry wants to do all we can to ensure that investors are fully informed before deciding which funds to own. This initiative is another positive step toward that goal.”
In comment letters to the Securities and Exchange Commission regarding reforms in disclosures, fees, and distribution arrangements between brokers and mutual funds, SIA called for a greater use of the Web and toll-free telephone services to explain to investors their costs when buying, holding onto, and selling a mutual fund. SIA also asked the SEC to hold a roundtable or other forums on distribution and disclosure issues to formulate reforms. The formation of the NASD task force is a positive step in that direction.
The comment letter regarding SIA’s support of an SEC bar on directed brokerage to compensate brokers’ selling efforts is at: http://www.sia.com/2004_comment_letters/989.pdf. Another SIA letter in support of an SEC plan to impose a two-percent redemption fee on mutual-fund shares is at: http://www.sia.com/2004_comment_letters/992.pdf
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The Securities Industry Association, established in 1972 through the merger of the Association of Stock Exchange Firms and the Investment Banker's Association, brings together the shared interests of nearly 600 securities firms to accomplish common goals. SIA member-firms (including investment banks, broker-dealers, and mutual fund companies) are active in all U.S. and foreign markets and in all phases of corporate and public finance. According to the Bureau of Labor Statistics, the U.S. securities industry employs 780,000 individuals. Industry personnel manage the accounts of nearly 93-million investors directly and indirectly through corporate, thrift, and pension plans. In 2003, the industry generated an estimated $209 billion in domestic revenue and $278 billion in global revenues. (More information about SIA is available on its home page: www.sia.com.)