MutualFundWire.com: Aguilar Gives ICI Attendees a Window into an SEC Commissioner's Thinking

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Monday, March 15, 2010

Aguilar Gives ICI Attendees a Window into an SEC Commissioner's Thinking

SEC Commissioner Luis Aguilar took the stage Monday morning at the ICI Mutual Funds and Investment Management Conference at the JW Marriott in Phoenix, discussing topics including target-date funds, money market mutual fund reform and the proposal calling for a systemic risk regulator.

Commissioner Luis Aguilar
SEC

For fundsters curious about the status of the joint investor guidance on target-date funds that the SEC and Department of Labor are working on, The MFWire caught up with Aguilar after his speech and asked when the guidance would be out.

"It hasn't hit my desk yet," he said.

In his remarks, Aguilar, who had worked at Invesco and law firm McKenna Long & Aldrige, told conference attendees to pay attention to the systemic risk regulator proposal.

"It could have wide-ranging ramifications on the mutual fund industry," he said. "It is a development that the mutual fund industry needs to closely monitor."

"Who will be the systemic risk regulator?" Aguilar said. "A systemic regulator that's bank-centric may want money market funds to be regulated as banks... The only thing that can be said today is that what will happen is anyone's guess."

On the subject of money market fund reform, Aguilar said that "more may be in the works." He repeated the comment he made during the SEC's January 27 open meeting on money market fund reform: "Any further reform must not be so transformational that the money market fund is no longer an economically viable product."

Any proposal, he said, should carefully consider the possible consequences. Aguilar warned against having a proposal that would trigger an exodus of trillions of dollars to unregistered vehicles.

As for target-date funds, Aguilar is pushing for clear disclosure that lays out important information.

"Even Morningstar, in its report on target date funds, said it was hard for it to get consistent information on basic glide path allocations, much less more sophisticated data," Aguilar said.

"If a professional data service like Morningstar is struggling, I am fearful for investors," Aguilar said.

Printed from: MFWire.com/story.asp?s=31652

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