Article: SEC Mutual Fund Oversight: Positive Actions Are Being Taken, but Regulatory Challenges Remain.

GAO-05-692T June 7, 2005

Trading abuses--including market timing and late trading violations--uncovered among some of the most well-known companies in the mutual fund industry permitted favored customers to profit at the expense of long-term shareholders. Questions have also been raised as to why the New York State Office of the Attorney General identified the trading abuses in September 2003 before the industry's primary regulator: the Securities and Exchange Commission (SEC). Based on two recently issued GAO reports, this testimony discusses (1) the reasons SEC did not detect the abusive practices at an earlier stage and lessons learned from the agency not ...

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