Author granted license

Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International

Document Type

Editorial

Publication Date

2006

Publisher

Debbie van der Beek

Language

en-US

Abstract

The SEC has been prolific in the past few years. By its own initiative, or because of congressional directives, the Commission has issued a record number of rules directed at the mutual funds advisory profession.

From 1975 to 2000 the SEC enacted about 135 substantive rules. However, it has enacted 70 such rules over the five-year span from 2001 to 2006. These rules are progressively more specific, eliminating flexibility, putting the profession in a straight-jacket, and imposing significant costs. The costs of these rules are especially irritating to advisors who have done no wrong.

Professional advisors blame the SEC for being over-zealous, self-interested, and driven by ambitions and self-aggrandizement. Yet, could it possibly be that the professional managers and their advisors are contributing to this rule avalanche?

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