March 4, 1992
TO: SEC RULES COMMITTEE NO. 9-92
STATE LIAISON COMMITTEE NO. 6-92
RE: INSTITUTE COMMENTS ON NASAA "HUB AND SPOKE" DISCLOSURE
__________________________________________________________
As we previously advised you, last month the NASAA
Investment Company Registration/Trading Practices Committee
issued cover page and prospectus disclosure language for states
to use in reviewing applications for registration of "hub and
spoke" funds. (See Memorandum to SEC Rules Committee No. 8-92
and State Liaison Committee No. 4-92, dated February 18, 1992.)
The Institute contacted the Chair of the NASAA Committee to
express its concern with respect to the disclosure, particularly
the fee table disclosure which is inconsistent with that required
by the Securities and Exchange Commission. In addition, the
Institute submitted a letter to the NASAA Committee which sets
forth specific concerns regarding the appropriateness of the
NASAA disclosure for these types of funds. A copy of the
Institute's letter was also sent to several other states that
have expressed an interest in, or commented on, hub and spoke
funds. These states are Arizona, Missouri, Oklahoma, South
Dakota, Texas, Washington and Wisconsin. Attached is a copy of
the Institute's letter to the NASAA Committee and the cover
letters to the above-referenced states.
We have requested a meeting with the NASAA Committee and
the other interested states to discuss our concerns. We will
keep you advised of developments.
Patricia Louie
Assistant General Counsel
Attachments