SEC Division of Investment Management staff letter: Mutual of America Capital Management LLC

Katten
575 Madison Avenue
New York, NY 10022-2585
212.940.8800 tel
www.kattenlaw.com
Richard D. Marshall richard.marshali@kattenlaw,com
212.940.8765 direct
212.940.8776 fax
Douglas J. Scheldt, Esq.
Associate Director and ChiefCounsel
U.S. Securities and Exchange Commission
Division ofInvestment Management, ChiefCounsel’s Office 100 F Street N.E.
Washington D.C. 20549
Re: Mutual of America Capital Management LLC
Dear Mr. Scheldt:
We request that you advise us that the staff ofthe Division ofInvestment Management (the "Staff”) will not recommend that the Securities and Exchange Commission (the "SEC" or "Commission") take enforcement action under Section 17(d) ofthe Investment Company Act of 1940, as amended (the “1940 Act”), and Rule 17d-l thereunder ifinvestment companies for which Mutual of America Capital Management LLC (the “Adviser”) serves as investment adviser allocate certain non-advisory operating expenses ofthese funds to underlying funds in which they invest and which are also advised by the Adviser, as described below.’ For the reasons discussed below, we do not believe that the proposed allocation of expenses should be subject to Section 17(d) and Rule 17d-l. Facts Mutual of America Life Insurance Company (“Mutual ofAmerica”) is a mutual life insurance company organized under the Insurance Law ofNew York. As a mutual life insurance company. Mutual of America does not have shareholders. Rather, it is operated for the benefit of its policyholders who are the participants in the retirement plans funded through Mutual of America’s group annuity products and the owners ofits individual annuity products. ' There may be situations in which funds in the Mutual ofAmerica fund complex in which the investment companies do not invest would also bear expenses ofthese investment companies. This situation differs from the situation in which the underlying funds which bear the fund offunds expenses are purchased by the fund of funds, in that those underlying funds derive a direct benefit from the fund of funds in the form ofthe enhanced sales oftheir shares that arise from the funds offunds’ asset growth. Nonetheless, even in the situation in which funds that are not underlying funds in a funds offunds structure would pay expenses of a fund offunds that does not purchase the fund’s shares, the funds that are not purchased by the fund of funds can benefit from the lowering of expense ratios that could arise from the growth ofthe overall fund complex. AUSTIN CENTURY CITY CHARLOTTE CHICAGO HOUSTON IRVING LOS ANGELES NEW YORK ORANGE COUNTY SAN FRANCISCO BAY AREA SHANGHAI WASHINGTON, DC LONDON: KATTEN MUCHIN ROSENMAN UK LLP A limited liability partnership including professional corporations 127984693V1