• 12b-1 fees cover the expense of posting a fund to the ‘supermarket’ and compensate financial advisors. 11
Conclusion • ‘Closing’ funds should be required to disclose to investors that they will continue to charge 12b-1 fees to fulfill commission obligations, even after the fund closes to new investors • 12b-1 Should probably be broken down further to ensure that they are actually being used for the intended purpose and not just an additional bonus for managers. 11
R eferences 13 2015 Investment company Fact Book ( ) Mutual Fund Fees and Expenses ( https:// ) SEC Probes Whether 12b-1 Fees Are Used Properly (April 9, 2015 ThinkAdvisor) Background Information About 12b-1 Fees ( https:// ) Regulators, Industry Favor Reform, Not Revocation of rule 12b-1 Mutual Fund Distribution Trends, the SEC Sweep Exam and the Backdrop of Rule 12b-1, Lybecker & Williamson, Investment Lawyer, 2013. Revenue Sharing: What Is It?, , Reish, 2008. Best Practices in Applying Revenue Sharing, Journal of Pension Benefits: Issues in Administration, Kirtland, 2011
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- Investment Company Act of 1940, ) Fees