Editor's Note

May 15, 2017

By Hillary Jackson

From the Editor...

 

It's been years since the Securities and Exchange Commission launched its distribution-in-guise sweep of the industry, and until this month only one firm had been charged with missteps in that area. That changed in the first week of May, however, when the SEC announced settlements with William Blair & Company and Calvert Investments for "improper" or "erroneous" distribution payments. In both cases, which involved penalty payments, only the advisers were found to be at fault; the firms' fund boards and compliance departments were not mentioned in the settlement documents.

 

Could there be more cases coming? Time will tell, but Anthony Kelly, co-chief of the Enforcement Division's Asset Management Unit, did hint recently that the agency is still very much focused on the issue.

 

In the meantime, former SEC Chief of Staff Buddy Donohue has reinvented himself yet again—this time as an independent director for OppenheimerFunds; he'll join the firm's Denver board at the start of next month. Donohue has done two stints at the SEC, served as a general counsel for several asset management firms, and worked in private practice, so he knows the industry well.   

 

In the courts, the first lawsuit alleging Section 36(b) violations since last year's AXA ruling has been filed against JPMorgan Investment Management. The firm is the defendant in another excessive fees case already, though that one is filed in a different court and involves funds not listed in the new suit. 

 

In our Viewpoints section, we bring you an article written by Management Practice Inc.'s Jay Keeshan on the retirement crisis, what needs to be addresses, and where fund directors might fit in to the whole picture. It's an interesting read, so have a look. We're always looking for pieces written by industry professionals, so please get in touch if you'd like to contribute.

 

For now,

 

Hillary Jackson, founding editor

hillary.jackson@fundboardviews.com