Surveys may find the banking industry misses the mark in explaining the risks involved in mutual funds, but Jean Jumet is confident her bank's customers know the score.

As head of compliance at Crestar Securities Corp., Richmond, Va., Ms. Jumet has instituted a comprehensive program with a single focus: risk disclosure.

To keep the Crestar Financial Corp. subsidiary out of regulatory trouble, its salespeople follow a standard script, which they must memorize and recite each time they talk to a customer who wants to buy a mutual fund. Salespeople also keep on their desks a sign with a bright-red border describing the three disclosures, and customers must sign a document explaining the disclosures before finalizing any purchase.

"The disclosures are very important," Ms. Jumet explains. "A customer can't walk out of our office without having seen and heard the disclosures three different times in three different ways."

The regulatory penalty for failing to properly disclose these risks can be severe. Just ask officials at Worthen Bank and Trust's brokerage. The Little Rock-based unit of Boatmen's Bancshares was fined $258,400 by the National Association of Securities Dealers last November for misleading customers about the hazards of mutual fund investing.

Compliance experts say Crestar's system is a model other institutions should follow. James Harris, senior consultant at Professional Bank Services, Louisville, says prepared scripts and written disclosures are key for any compliance program.

"It's a pretty good policy because it forces them to give all of the details first," according to Mr. Harris.

Many banks, however, aren't properly warning consumers. A recent survey by Prophet Market Research, a San Francisco-based mystery-shopping firm, found that 27% of bank brokers didn't give the right disclosures to mutual fund customers.

And a forthcoming study done for the Federal Deposit Insurance Corp. by Market Trends Research, Bellevue, Wash., is expected to show similar, though less gloomy, results.

"This area is really about to explode," Mr. Harris said. "The agencies are really going to start concentrating more on this type of compliance."

Ms. Jumet expects Crestar's program to shield it from the regulatory crackdown. The bank took its disclosures from the February 1994 interagency statement on retail sales of nondeposit investment products. The policy requires banks to tell customers that mutual funds do not carry deposit insurance, are not guaranteed by the bank, and can result in a loss of principal.

Banks that deal in mutual funds and other nondeposit products have been scrambling to ensure their salespeople follow those guidelines.

Ms. Jumet's script begins with an explanation of Crestar Securities Corp. Next, Crestar employees make the three disclosures. Then they discuss various sales charges, which are detailed in a document given to customers. "It puts all the cards on the table," she says.

Finally, the customers are given a chance to ask questions.

Customers see the disclosures twice more before the sale is completed. Crestar keeps a close watch on its salespeople to ensure compliance. It holds monthly meetings, requires quarterly training, and mystery-shops its branches twice a year, Ms. Jumet said.

She added that the mystery shopping is done internally to keep the costs down.

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