From: J. L. Sramek
SEC Chairman Christopher Cox
Dear SEC Chairman Cox,
Mutual funds are an increasingly important savings vehicle for tens of millions of working Americans like me. We are the owners of these funds and we bear the risks if they are dominated by self-interested insiders. We look to the Securities and Exchange Commission (SEC) to protect us. I am writing to express my strong support for the proposed rule requiring that mutual fund boards have an independent chairperson and at least 75 percent independent directors. These rules were among the most important reforms adopted by the SEC in the wake of the mutual fund trading and sales abuse scandals.
A recent study by AFSCME and The Corporate Library found mutual funds provide a rubber stamp for excessive management pay, supporting more than three-quarters of all management pay proposals. Ninety percent of institutional investors think the current system overpays executives. We need independent directors to stand up to the excesses of the money managers.
We invested my mom's meager savings in mutual funds many years ago and they did well for a time, but it has been 10 years since she died and the fund that she had has never come up to even the level is was at at the time of her death. Financial advisors always push voting for the CEOs point of view and since we don't; we actually read the proposals. we are definitely in the minority. Companies and their boards bank on the fact that people are not going to read nor understand these proposals and thus they can get by with anything they choose.
My PERA fund and TRA fund are badly managed and there is no excuse why some years we get almost no raise...094% is no raise and other years not even COLA...How are people supposed to benefit from pension funds which we paid into heavily if wise investments are not made and an independent board is not mandatory. Right now a money fund which is just a holding fund like a savings account is making way over the amount that PERA and TRA are paying their retirees. I feel there are way too many corporate minded people running these organizations and I do vote but find few people worth voting for. These are funds with large numbers of people in them and they have gone downhill every year; it is discouraging..An independent board would hold corporations manning these mutual funds accountable.
The Investment Company Act requires that mutual funds be managed in the interests of their shareholders. Requiring independent directors and chairpersons will help ensure this safeguard for the small investor, to make sure the little person gets a fair shake.