Subject: File No. S7-03-04
From: E Malcolm York
Affiliation: Retired, formerly a chief financial officer of a large private company

June 19, 2006

Having served as the fiduciary of an employee retirement plan for over 30 years and having also owned shares myself in many mutual funds, both directly and as a trustee (and still do), I have long been concerned with the degree of checks and balances in the management of mutual funds.

In my opinion, it is absolutely essential that each mutual fund have an independent chairman. I have read all the arguments about adding to fund costs and incumbering management's flexibility and I don't buy it. It is a small price to protect fund shareholders. I also support the majority of board members be independent to insure the boards are truly independent of the funds' leadership. While I've long respected some super-fund familys like Vanguard and Fidelity, they too need to layer-in independent corporate governance, no exceptions. Only in this way can we re-establish confidence in the integrity of mutual funds that will lead to increased efficiency and competitiveness of our U.S. capital markets. Some of this may arise through an attrition of the vast number of funds that liter our investment landscape.