From: Michael Riccio [sempre@optonline.net] Sent: Sunday, December 07, 2003 11:03 AM To: rule-comments@sec.gov Subject: Mutual Fund Regulations (s7-26-03 and S7-27-03) To Whom This May Concern, I am typing this email to voice my support of the Mutual Fund regulations. I support imposed new curbs on fund abuses, notably prohibition of short term trading by fund insiders. That practice is under scrutiny in many of the recent cases cited by regulators. The quick trades, known as market timing, are not illegal, but most funds do no allow them because they skim profits from longer term shareholders. I support the requirement for funds to closely monitor enforcement of the 4 pm Eastern price closing time, to ensure that investors receive same day execution of their trading orders and that those in the West will not be disadvantaged. I support the requirement for mutual funds to provide more information to investors on fees and fund operations, including the compensation of portfolio managers. Data to be disclosed also would include a fund's estimated operating expenses in dollars on a hypothetical $1,000 investment as well as fund companies' special deals with brokerage firms to get them to sell particular funds to investors. I think the bill should go a little further and make sure that mutual fund companies do not pay out higher commissions to portfolio managers that sell particular funds to investors particularly their own funds. A good example of this abuse was recently illustrated by Morgan Stanley. I support the provision that requires brokerages to sell some 80 percent of all mutual fund shares and collect billions of dollars in fees annually for those sales. I support the requirement that two thirds of the directors on a fund company board be independent from the companies managing the funds. Finally, I support the requirement that all funds have chief compliance officers reporting directly to the independent directors, as well as internal compliance procedures and protections for whistle blowers. We must instill trust in our markets in order to insure that our economy prospers. Sincerely, Michele Riccio