In response to the Securities and Exchange Commission's request for comments made pursuant to the Private Securities Litigation Reform Act of 1995 in the above-referenced Release, the Investment Company Institute submits the following comments. It also seeks comment on the need for additional protections for these investors against securities fraud, on whether or not these investors have been adversely impacted by abusive or unnecessary securities fraud litigation and on recommended changes to securities laws and regulations that would protect these investors against such fraud and litigation. Institute members play an increasingly active role in the retirement plan market.
Mutual funds are a popular investment vehicle for retirement plan investors.
Moreover, many funds or their affiliates offer recordkeeping and other administrative services to these plans. The Institute therefore is pleased to offer its recommendations to the Commission on these matters. More particularly, the Institute recommends repeal of the statutory exemptions from the securities laws for bank collective funds and insurance company separate accounts in which pension plan assets are invested. In 1970, Congress amended the Investment Company Act of 1940 to exempt from the definition of an investment company any bank collective fund that consists solely of the assets of qualified retirement plans. The same provision exempts insurance company separate accounts the assets of which are derived solely from contributions under such plans.