SEC Releases Final Rule On Portfolio Manager Disclosure

Fund companies have had to name top fund advisors. Now, the SEC also is increasing the management team listing requirements.

Once the new rule takes effect, VA and fund registration statements must give the name, title, length of service and business experience of each member of a portfolio management team.

The SEC has responded to public comments by agreeing to let portfolios that have more than 5 people with joint and primary responsibility for day-to-day portfolio management limit themselves to listing just the top 5 portfolio managers.

Each portfolios Statement of Additional Information, a document that supplements the prospectus, must disclose the names of other portfolios that a manager manages, describe managers ownership interest in the portfolio, and describe the managers compensation structure.

The back cover of a prospectus must either tell investors how to find an issuers additional information statements on its Web site or explain why it does not offer the statements on its site.

On the front cover, issuers must provide a toll-free telephone number customers can use to request additional information statements and other documents, and they must give the Web address of the SEC.

The SEC has posted the final rule at //a257.g.akamaitech.net/7/257/2422/06jun20041800/edocket.access.gpo.gov/2004/pdf/04-19575.pdf.

Reproduced from National Underwriter Life & Health/Financial Services Edition, September 3, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.