MessageFrom: George Fisher [grfiv@bellatlantic.net] Sent: Friday, April 16, 2004 8:54 PM To: rule-comments@sec.gov Subject: Independent Mutual Fund boards (s7-03-04) George R. Fisher 125 N Chancellor St Newtown, PA 18940 917-514-8204 grfiv@bellatlantic.net I attended Chairman Donaldson's testimony before the Senate Banking committee on April 8. The most spirited discussion involved "independence". There was strong sentiment against having an independent mutual fund board chairman, but there did seem to be a consensus that having 75% of mutual fund boards be independent was a good thing. It would be a good thing, of course, only if "independence" were a fact. The Wall Street Journal recently ran an article about several very qualified people who were interested in acting as independent mutual fund trustees but who had discovered that the mutual funds had no interest in their services. This article should have contained no surprises, but it should have made the SEC feel ashamed of the role it has failed to play in regulating the mutual fund industry to this point; and make it determined to improve the situation in a real and material way. A good start toward reforming the mutual fund industry would be made if the SEC approved regulations which require mutual fund boards to be 75% independent and to define "independent" in a way that would make it very difficult for funds to avoid the spirit that would obviously be intended by these regulations. An independent trustee must: 1.. Not work for, or ever have worked for the management company or related entities 2.. Not work for, or ever have worked for any entity that received compensation from the fund or the management company or related entities 3.. Not be related to or employed by anyone who fails to satisfy the first two criteria This is not a comprehensive list, but it should be a minimal starting point.