Honolulu, Hawaii - United States Senator Daniel K. Akaka (D-Hawaii) issued the following statement in response to the proposed rules issued today by the Securities and Exchange Commission (SEC). Senator Akaka is the sponsor, along with Senator Peter Fitzgerald (R-IL), of the Mutual Fund Transparency Act of 2003 (S. 1822), legislation which would strengthen board independence, enhance the transparency of financial relationships, and require disclosure of financial relationships between brokers and mutual fund companies and of certain brokerage commissions paid by mutual fund companies.

"I commend the SEC for its proposals intended to improve the corporate governance of mutual funds and to increase the transparency of mutual fund fees that investors pay.

"The new SEC requirements for an independent chairman for mutual fund boards, increased percentage of independent directors to 75 percent, and development of a confirmation notice so that investors will be able to know how their broker gets paid in mutual fund transactions are a solid and measured response to the litany of transgressions which have undermined public confidence in the mutual fund industry. I am pleased that the Commission has acted to protect the 95 million American investors who have invested a significant portion of their financial security in mutual funds. These provisions mirror those in my Mutual Fund Transparency Act of 2003, which I introduced in November in order to restore public trust in the mutual fund industry.

"As I review the specifics of the SEC's proposal, I continue to urge the Senate to act on legislation to strengthen the independence of mutual fund boards and to increase disclosures in order to provide useful and relevant information to mutual fund investors."