UB School of Management's Trzcinka to Testify Before Congressional Subcommittee On Finance

BUFFALO, N.Y. -- Charles Trzcinka, associate professor of finance and managerial economics in the University at Buffalo School of Management, will testify before a congressional subcommittee investigating fees and price competition in the mutual-fund and bond markets.

Trzcinka will testify at a hearing to be held by the House Subcommittee on Finance and Hazardous Materials, which oversees the Securities and Exchange Commission (SEC), at 9:30 a.m. on Sept. 29 in the Rayburn House Office Building in Washington, D.C.

Also set to testify are SEC Chairman Arthur Levitt; Micheal Lipper, president of Lipper Analytical Service, and industry representatives including Matthew Fink, president of the Investment Company Institute, and William McNab of the Vanguard Group.

The hearing will examine whether investors are getting their money's worth for fees paid on mutual funds, the impact of fees on mutual-fund performance and whether investors are provided adequate information about prices when considering investments in the bond market.

"I plan to testify that fees on mutual funds are complicated and difficult to relate to the quality of the fund," Trzcinka says. "The result is that the mutual-fund industry does not compete by changing fees as often as they would if investors had better information.

"This makes it difficult for investors to monitor their mutual funds, so many investors don't pay attention to fees. When you don't pay attention to fees, they go up, not down."

Trzcinka is a nationally renowned expert on mutual-fund fees and mutual-fund performance. His research has been the subject of articles in The New York Times, The Wall Street Journal, USA Today, Money, Business Week and Forbes.

Author of the Forbes Stock Market Course, he is an associate editor for the Journal of Corporate Finance and the Financial Review.