SEC to fund firms: Ixnay on the money fund complaints

SEC to fund firms: Ixnay on the money fund complaints
Walter wants industry participants to cool the rhetoric, refrain from issuing public statements; 'destructive disengagement'
APR 12, 2012
Securities and Exchange Commissioner Elisse Walter would prefer firms keep their thoughts on money market fund reform out of the public eye. “For some reason, lately the topic of money market reform seems to be making all of us emotional, strident and, to a certain extent, some of us are losing our heads,” she told attendees at the Investment Company Institute's mutual fund and investment management conference today. “The topic is too important to be played out through a public volley of opinions, but that's where we are today.” She added: “I'd encourage firms to stay away from media statements. We need to restart constructive engagement, rather than destructive disengagement. The current environment is not conducive to reaching the best conclusions.” Ms. Walter also stressed that the reforms that were enacted in 2010 — which some industry participants contend are enough to protect investors — were always intended to be the first step towards money market reform, not the end of it. Indeed, without additional changes, money funds will still be vulnerable to a market panic like the one that rocked the industry in 2008. “Historically, money market funds have a strong record of stability," she said. "But that doesn't tell the whole story." In 2007 and 2008, more than 100 money market funds received “bailouts” from their managers or affiliates to maintain their $1 net asset value and not break the buck, according to the SEC. The discourse over potential money market reforms has reached a fever pitch lately as a formal proposal from the SEC draws closer. Potential proposals could require money market funds to float their net asset value, have a capital buffer, or both. The topic is generating a great deal of interest due to the vast size of the money market fund industry. More than 640 money market funds are registered with the SEC, holding ore than $3 trillion in total assets. That represents nearly 25% of all investment company assets, Ms. Walter said.

Latest News

Private credit becoming 'big piece' of annuities, T. Rowe exec says
Private credit becoming 'big piece' of annuities, T. Rowe exec says

Goldman Sachs retirement survey finds 83% want guaranteed income, while the annuities providing that income increasingly hold private credit.

Zocks debuts Claude plugin with seven skills for financial advisors
Zocks debuts Claude plugin with seven skills for financial advisors

The AI meeting assistant's Advisor Intelligence plugin turns client conversation data into annual reviews, tax scans and attrition alerts.

Stifel settles massive $30 million complaint involving star broker’s sale of structured products
Stifel settles massive $30 million complaint involving star broker’s sale of structured products

Chuck Roberts and Stifel have been facing scrutiny due to sales of structured products and structured notes.

SEC floats CFP route to accredited investor status, fund rules refresh amid private market push
SEC floats CFP route to accredited investor status, fund rules refresh amid private market push

Among other updates, the proposals would let advisors to regulated funds earn performance fees and allow interval funds to offer monthly repurchases.

The Year Is 2046 and I’m a Financial Advisor 
The Year Is 2046 and I’m a Financial Advisor 

What will financial advice look like 20 years from now? Evan Vladem explores how AI may transform wealth management while reinforcing the enduring value of human guidance, trust, and empathy. 

SPONSORED In the Age of AI, Trust Becomes the Advisor's Greatest Asset

As AI makes financial information more accessible than ever, Lana Hock explains why human judgment, trust, and empathy remain the qualities clients value most in a financial advisor

SPONSORED Direct indexing webinar targets tax-loss harvesting amid market swings

Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains