Partner Barry Hurwitz spoke with Fund Directions about the implementation of the fund of funds rule, which in part makes advisers responsible for deciding whether a fund of funds requires that shareholders pay duplicate fees, rather than the fund board. “It used to be a requirement that boards had to make certain findings about, for instance, the reasonableness of fees in light of the services provided to the fund or whether an arrangement was likely to result in an acquiring fund exerting undue influence on an acquired fund,” Barry explained. “Under the rule, it’s the advisor that has to make those fundings. So that may be a benefit to the board.”
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