SEC independence rule under fire
NEW YORK – The Securities and Exchange Commission (SEC) rule that requires at least 75% of mutual fund board members, including the chairman, to be independent, is hanging in the balance – a US federal appeals court sent it back to the SEC for further review in early April.
The new rule is being contested by the US Chamber of Commerce. Previously, 40% of mutual fund board members were required to be independent.
The Appeals Court for the district of Columbia Circuit said the SEC violated administrative procedure by not giving an opportunity for the public to comment on the rule, even though the Commission relied, at least in part, on new information to determine the costs of the rule.
This is the second time the 'independence rule' has been sent back to the SEC
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