11/01/2012– Former financial regulator Sheila Bair voiced worries about a new industry compromise plan for money market mutual funds, including implementing a fee for withdrawals during times of stress, saying it could worsen a crisis.

Fund companies met with regulators last week in Washington, hoping they would accept limited new rules for stabilizing the funds if necessary. But Bair dismissed such notions in a statement e-mailed by a spokesman.

“While I commend responsible members of the industry for trying to find solutions, I am concerned that gates coming down or fees going up in the middle of a crisis could make matters worse,” Bair said in the statement on Thursday.

“Another layer of complexity is not going to calm an already very risk-averse market,” wrote Bair, who chairs the Systemic Risk Council, a non-partisan group of former regulators, investors and academics backed by the Pew Charitable Trusts and the CFA Institute, set up to monitor new financial rules and reforms.

Read the full article, Former regulator pours cold water on fund industry plan, on the Reuters website.