Created by CREW

CREW: SEC: Regarding Documents on State-Law Loophole in Shareholder's Voting Rights

On June 2, 2010, CREW sent a Freedom of Information Act (FOIA) request to the Securities and Exchange Commission (SEC) seeking documents related to the agency’s enforcement of the Investment Company Act of 1940 with respect to closed-end funds. Notwithstanding provisions of that Act that require all shares of stocks in closed-end funds to have equal voting rights, state laws, including in Maryland, restrict shareholders who own a certain percentage of stocks from voting control shares. These state laws have allowed boards of directors to retain control over funds even when they are not acting in the best interests of the shareholders.