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SEC Money-Fund Compromise Faces Opposition in Final Fight

The mutual-fund industry’s main trade group, in what may be the last round of lobbying against tighter rules for money-market funds, rejected a scaled-back proposal to force only the riskiest funds to give up their stable $1 share price.

The compromise, unanimously approved by SEC commissioners June 5, would harm investors and the economy, and would increase systemic risk, the Investment Company Institute said today. The group supported an alternative option offered by the SEC to limit withdrawals when funds come under stress.