CMFI Comment Letter on Money Market Fund Reforms

On January 21, 2011, the Coalition of Mutual Fund Investors (CMFI) submitted a comment letter to the SEC, regarding potential money market fund reforms.

 

Last fall, the President’s Working Group on Financial Markets released a study of possible reforms to mitigate the susceptibility of money market funds to “liquidity runs.”  The SEC then asked for public comments on the study and the regulatory options presented.

 

The CMFI comment letter expresses support for the creation of a private liquidity bank and urges that additional measures be taken to improve transparency within third-party omnibus accounts.  The comment letter expresses opposition to a two tier classification system for money market funds, in which retail investors would be offered  fixed net asset value funds, while institutional investors would be restricted to floating net asset value funds.  The comment letter also expresses opposition to the regulation of money market funds as special purpose banks.  Click on the following link in the Regulatory Tracker section of the CMFI website to review this comment letter: 

http://www.investorscoalition.com/CMFI_Comment_Letter_re_Money_Market_Fund_Reforms_1-21-2011.pdf

 

Niels Holch

Executive Director, CMFI