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House Bill Omits BDC Fee Disclosures

Observant1
in Other Investing
"The US House recently passed a bill that would allow registered investment companies to exclude
business-development company fees from their disclosures of acquired fund fees and expenses,
which, we believe, would be a detriment to investors."

"This so-called small-business provision would permit mutual funds, closed-end funds,
and other registered investment companies to omit from their fee tables the costs they incur
when investing in business-development companies, or BDCs."

"This creates a dangerous precedent, allowing complex, fee-laden investment vehicles to be hidden
from the comprehensive cost disclosure that has been a cornerstone of investor protection since the
Investment Company Act of 1940 was signed into law."

https://www.morningstar.com/funds/hidden-fees-hidden-dangers-why-house-passed-plan-threatens-investor-protection

Comments

  • Old_JoeOld_Joe
    Who paid who on this? Follow the money...
  • MarkMark
    edited December 15
    Always OJ. (And also be watching for a flurry of new BDC's to be in registration)
  • Observant1
    edited December 15
    H.R. 3383 was proposed by Representative Ann Wagner (R - MO).

    Representative Ann Wagner's Top Contributors, 2023 - 2024
    https://www.opensecrets.org/members-of-congress/ann-wagner/summary?cid=N00033106

    Clients Lobbying on H.R.3383: Increasing Investor Opportunities Act
    https://www.opensecrets.org/federal-lobbying/bills/summary?cycle=2025&id=hr3383-119

    The Securities & Investment industry donated the second most amount of money (behind "retired")
    to Representative Wagner from 2023 to 2024.
    The Investment Company Institute, Ameriprise Financial, Franklin Resources,
    and the Securities Industry & Financial Markets Assn. (among several others) lobbied on behalf of H.R. 3383.
    I'm sure this is all just a mere coincidence!
  • yogibearbullyogibearbull
    There was a recent discussion of BDCs vs REITs. Investors see similarities in them, but regulators see their legal differences.
    https://www.mutualfundobserver.com/discuss/discussion/64734/alert-on-fund-ers
  • Old_JoeOld_Joe
    What was it that Mark Twain said ?? Oh yeah:
    "We have the best government that money can buy."

    The things most impervious to change aren't the good things.
  • CrashCrash
    Gravity. Everything that escapes from the Capitol and falls down its steps just smells like garbage. Transparency? Disclosure? Who needs THAT? Excuse me while I go vomit AGAIN.
  • beebee
    MO = The "Show Me" State... let's see, in this case, if that is still true.
    The most widely known legend attributes the phrase to Missouri's U.S. Congressman Willard Duncan Vandiver, who served in the United States House of Representatives from 1897 to 1903. While a member of the U.S. House Committee on Naval Affairs, Vandiver attended an 1899 naval banquet in Philadelphia. In a speech there, he declared, "I come from a state that raises corn and cotton and cockleburs and Democrats, and frothy eloquence neither convinces nor satisfies me. I am from Missouri. You have got to show me." Regardless of whether Vandiver coined the phrase, it is certain that his speech helped to popularize the saying.
    https://sos.mo.gov/archives/history/slogan
  • WABACWABAC
    They showed here the money.
  • beebee
    WABAC said:

    They showed her the money.

    good one!
  • MarkMark
    Well it looks like the SEC has created an outlet for all that private credit none of the big boys wanted.
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