From: IRWINFISCH@aol.com
Sent: Monday, February 16, 2004 2:44 PM
To: rule-comments@sec.gov
Subject: S7-03-04: 
All of the items mentioned in the proposed regulations are truly important governance 
issues.   However, the most vital issue is not mentioned.   I refer to the matter of how 
directors are initially identified and selected for nomination to the board.

The word "independent" is, in essence, a very vague term.   It is easy to visualize a 
mutual fund management scrambling to find a potential director who meets the technical 
qualifications of being independent, but in fact is easily controlled by factors of 
compensation and/or outside relationships.

In my opinion, if true independence is desired, the management of a mutual fund company 
should not have any input on director selection.   These decisions should be imposed upon 
the fund by outside authority (SEC) and care should be taken to assure that management does 
not have any control over the process.    

Effective independence is obtained when authority flows from the top to bottom;  not from 
the bottom up.   Under these circumstances, it would be interesting to observe how quickly 
the investment advisory fees would undergo drastic downward reductions, particularly when 
economies of scale are patently obvious.

It is time for the regulators to set aside the silk gloves and begin to seriously protect 
the average investors.

Sincerely,

Irwin Fischman, CPA
2530 Windrush Lane
Northbrook, Illinois    60062
(irwinfisch@aol.com)