White Papers On Business Challenges Facing the Mutual Fund Industry Available

VERONA, NJ, November 5, 2003 -- 401k Education, Inc., a fee-only consultant to retirement plan sponsors and mutual fund shareholders, is producing a series of whitepapers detailing the behind-the-scenes administrative conditions currently in place in the mutual fund industry. This series will examine the hierarchy of the fund industry's compliance, portfolio management and corporate governance units and detail how these vital departments are mechanically intended to function. The whitepapers will also answer why the designated enforcement authorities -- the SEC, NASD and mutual fund directors -- were so ineffective in preventing the unlawful and unethical activity that has recently been dominating the business headlines.

Some of the main findings include:

• Routine surveillance should have uncovered most of the illegal practices as soon as they occurred;
• Some mutual fund companies lightly regard SEC oversight;
• The mutual fund organizational culture actually retards the efforts of their own compliance departments;
• The Boards of Directors of most mutual fund companies do not employ explicit policies that translate into increased supervision of the firms' employees;
• Many mutual fund companies, already strapped financially because of the multi-year pullback in equity markets, will be negatively impacted by the terms of the pending settlement, which will in turn affect shareholders;
• The SEC's career civil servants are not sufficiently trained to predict and identify fraud;
• The trustees of most 401k plans do not fully understand the mechanics of their corporate relationships, especially how the mutual fund companies and intermediaries fully benefit;
• The NASD and SEC tolerate an unrealistically low ratio of corporate governance employees throughout the industry relative to the number of investment employees requiring surveillance.

About 401k Education, Inc.

401k Education, Inc. is not an investment advisor and does not receive compensation from gathering mutual fund assets. Our firm serves as experts to the largest end-users of mutual funds in the US -- employer-sponsored retirement plans (401ks, 403bs, etc). 401k Education advises plan trustees on the "real world" issues surrounding mutual funds and the investment product industry. We also train employees on how to manage their self-directed investment accounts.

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