New York Attorney General Eliot Spitzer, in a speech today at the National Press Club, said he hopes the one lesson mutual funds might have learned from the recent scandals is that "board members need to live up to their duty to shareholders.
"I think that they forgot that that was their constituency. By virtue of their forgetting whose voice they were supposed to speak on behalf of, they strayed and have permitted performance to lag and fees to escalate over time. The fee structure has an enormous compounding effect on the return that investors get over time, and if (they had spoken up) they would have forced fees down a few percentage points year over year, and investors would have a lot more money in their pockets."
