There are seven deadly sins for mutual fund boards, writes Smartmoney in a feature article on why Schwab's YieldPlus fund turned into a debacle for shareholders.

The article is exhaustive and includes interviews with a wide variety of board members, industry experts and academics.

It also takes a dim view of the value of mutual funds boards. That view may be best summed up by University of Virginia law school professor John Morley who says: "The real puzzle isn't why these safeguards don't work. It's why anybody thinks they could work."

Those sins are:

No investors allowed (on boards)

Pay -- but no say (board members are well paid for few duties)

Heavy homework (board members are provided pounds of material for their meetings, more than they can comprehend).

No limit (fees charged by fund advisors are too high, and boards are afraid to limit them. Proof is the advisors' average margins of 40 percent on average).

Family ties (even independent board members are not independent enough).

Lifetime security (board members keep their seats for more than 20 years on average).

Performance anxiety (most funds are trailing their benchmarks, and boards are not acting).

Take some time to read the rest if you want to stay informed on what the popular financial press thinks of mutual fund boards. 

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