From: Henry Gwiazda [henry.gwiazda@nara.gov]
Sent: Tuesday, January 27, 2004 11:37 AM
To: rule-comments@sec.gov
Subject: (s7-29-03, s7-04-04) Mutual Fund Company Guidelines

Dear SEC: 

With the understanding that the SEC has been underfunded and understaffed by 
Congress, which has not had the public good in mind by such a failure to fund, 
it still is the responsibility of the SEC to ensure that financial markets are 
fair and transparent. More people today are dependent for their retirement on 
mutual fund investments than ever before, and the great number of these people 
are not well informed or sophisticated investors. And it is clear that the greed 
of many individuals and funds has led to significant and long term fleecing of 
these investors who trusted them. 

Therefore, all that you can do to curb the conflicts of interest, the skimming 
of investors' potential gains, and the lack of transparency on costs is to 
the good. 

Specifically, 

1. Code of ethics for fund employees and specifically re personal trading. 

Comment:  Personal trading in one's own funds or fund company should be 
prohibited. A code of ethics can be a weak thing in the face of greed. Do 
you also propose to have fines and criminal penalties for breeches of such 
codes? Have you consided proposing new and stronger legislation and penalties 
here and in other areas? 

2. 75% of Board of Directors independent

Comment: It's all well and good to have a nominally independent director, 
but the SEC should also limit the number of boards directors can serve on 
so that the boards they actually do serve on can get the individual's full 
attention and time needed to do the job. 

3. Revealing the true costs of mutual funds in dollar amount and percentages

Comment: How else can markets be free and unrigged if the investor is not 
given full, accurate, and easily understandable information on costs? It 
has been a shock to me to learn that various costs have been passed on  to 
investors without their knowledge or without the need to state them for 
the investors information. Where has the SEC been all along? 

4. Customers to receive cost and conflict of interest information at point 
of sale and at completion of sale. 

Comment: This requirement is absolutely imperative, AND the information 
should be in writing. Oral representations from slick salesmen are not 
worth the time of day. 

5. Companies to give investors information to show how a particular funds 
costs compare to similar funds.

Comment: Again this information is absolutely necessary for a transparent 
and properly functioning market. Regardless of the industry's expected 
opposition to this requirement,  the SEC has an obligation to the public 
to require this information in a clear, accurate, and readily understandable 
form. There are far too many people without the knowledge or training or 
sophistication to protect themselves through their own research or expertise. 
That is why there are regulatory agencies like the SEC. 

Sincerely, 

Henry J. Gwiazda