Money Management Executive articles from November 2004

Money Management Executive archives from November 2004

Galvin Charges Franklin For Not Admitting Guilt.(Franklin Templeton Investments)(Brief Article)
November 1, 2004... Franklin Templeton Investments filed "false and misleading statements" with the Securities and Exchange Commission by not admitting to wrongdoing in settling its mutual fund case, Massachusetts Secretary of the Commonwealth William Galvin has...

NASD Fines Citigroup for Abusive Sales Practices.(Citigroup Global Markets Inc.)(National Association of Securities Dealers)(Brief Article)
November 1, 2004... The NASD has fined Citigroup Global Markets $250,000 for distributing inappropriate hedge fund sales literature. The penalty marks the agency's heftiest fine for abusive hedge fund sales practices by broker/dealers. The NASD also censured...

SEC Suspects Kickbacks To Retirement Consultants.(Securities and Exchange Commission)(Brief Article)
November 1, 2004... The Securities and Exchange Commission reportedly fears that investment companies may have paid retirement-plan consultants in order to steer business their way. A probe that began last December looking into possible conflicts of interest in...

Re-Branding Efforts Clear PIMCO Name: Allianz CEO Admits Marketing Mistake.(Allianz Dresdner Asset Management)
November 1, 2004... After months of clamoring for a divorce from its equity fund affiliates, Bill Gross finally got his wish. The PIMCO brand name of mutual funds will officially cut ties with its tainted affiliates early next year, as parent company Allianz...

Hedge Fund Registration Narrowly Passes.
November 1, 2004... It's official. In a highly anticipated move, the Securities and Exchange Commission voted 3-2 in favor of requiring hedge fund managers to register as investment advisors with the agency last week. The mandate, which will take effect on...

Firms Struggle to Recover Failed Execs' Pay: Scandal-Linked Fund Execs Keep Cash Despite Troubles.
November 1, 2004... Larry Lasser: $78 million. Mark Whiston: $14 million. Walking away from the biggest scandal in the history of the mutual fund industry with boatloads of cash: Priceless. Several ex-CEOs and former high-level executives in the fund...

ABN AMRO Determined To Triple Assets in China.(ABN AMRO Bank N.V. of Netherlands)(Brief Article)
November 1, 2004... For its one-year-old Chinese mutual fund venture, ABN AMRO has set its sights on tripling its assets by the end of next year. Just one month after it got the okay to put $75 million into Chinese stocks and bonds, the Netherlands-based company...

Lipper Acquires Fitzrovia, London Fund Data Provider.(Fitzrovia International)(Brief Article)
November 1, 2004... Mutual fund research giant Lipper has purchased Fitzrovia International for an undisclosed amount of money. Fitzrovia, considered Lipper's equivalent in London, specializes in the analysis of non-U.S. funds' total expense ratios. In a...

Executive Moves.(Phoenix Companies Inc. appointed Christopher Walsh as managing director)
November 1, 2004... Phoenix Hires Walsh to Fill Newly Created Position Continuing its drive toward attracting institutional assets, The Phoenix Cos. has hired Christopher Walsh, a 15-year industry veteran, to fill a new position, managing director of...

Fund Investors Lose Heart Post-Scandal: ICI Head Discusses Shareholder Sentiment.
November 1, 2004... NEW YORK - Some fund investors have lost that loving feeling. The approval rating for the mutual fund industry has slipped in the past few years, as the market-timing and late-trading scandals coupled with a prolonged bear market have...

Novel ETFs Heat up Market.(exchange-traded funds)
November 1, 2004... NEW YORK - One of the hottest investment markets is getting ready to add even more sizzle, as new and unique exchange-traded funds (ETFs), some currently in SEC registration and still under regulatory scrutiny, are expected to roll out shortly....

Directed-Brokerage Ban to Significantly Impact Business.
November 1, 2004... The Securities and Exchange Commission's ban on funds directing trades to brokers in exchange for shelf space, or directed brokerage, has mutual fund companies scurrying for new ways to compensate distributors. "Every fund family...

SEC Might Lean on States Due to Hedge Fund Rule.(Securities and Exchange Commission)(Brief Article)
November 8, 2004... The Securities and Exchange Commission is reportedly considering shifting some of its responsibilities to the states, as the agency expects a surge of up to 15% in the number of investment advisors it oversees once the new hedge fund...

Hedge Fund Beacon Hill Settles With SEC for $4.4M.(Securities and Exchange Commission)(Brief Article)
November 8, 2004... Hedge fund Beacon Hill Asset Management and four of its top executives have settled with the Securities and Exchange Commission for $4.4 million stemming from fraud charges. In addition, the four executives have been barred from the investment...

Funds Purposely Mispriced Illiquid Assets, SEC Says.(Securities and Exchange Commission)(Brief Article)
November 8, 2004... Securities and Exchange Commission examiners are reportedly finding instances of fund managers intentionally mispricing junk bond and small-cap stock mutual fund holdings and may soon take action. These securities are particularly...

Quick Election Results Calm Market Jitters.
November 8, 2004... The wait is over. The presidential election is complete, and with fears of a repeat of the Gore-Bush 2000 fiasco quashed, the market rallied with the definitive outcome. Most observers agreed that a swift conclusion to the election, with...

Fremont Fined $4.1M for Timing, Late Trades: Smaller Fund Shops Not Immune to Scandal.(Fremont Investment Advisors Inc.)
November 8, 2004... Market-timing woes continue to pervade the mutual fund industry, as even smaller shops are getting caught in the act. Fremont Investment Advisors (FIA) on Thursday agreed to a $4.146 million settlement with state and federal regulators over...

ETFs Infiltrate Long-Term Portfolios.(exchange-traded funds)
November 8, 2004... Exchange-traded funds (ETFs) are definitely gaining wider appeal. But financial service providers, once happy to welcome predominantly institutional investors to these products, are now busily focusing efforts to entice long-term investors. ...

Putnam Discloses Stake Managers Have in Funds.(Putnam Investments Inc.)(Brief Article)
November 8, 2004... To prove to its investors that it is working tirelessly to regain a once solid reputation, Putnam Investments has begun to disclose to the Securities and Exchange Commission how much money its fund managers, employees and trustees invest in the...

ETF Assets Up 20% in 04.(exchange-traded funds)(Brief Article)
November 8, 2004... Assets in exchange-traded funds rose 20% in the last nine months through September, buoyed, perhaps, by the continuing fallout from the mutual fund scandal. In its monthly report on ETFs, the Investment Company Institute found that assets grew...

NASD May Take Action Against ING Funds Unit.(National Association of Securities Dealers)(ING Insurance Co.)(Brief Article)
November 8, 2004... A U.S. subsidiary of Dutch financial services firm ING Group indicated in an SEC filing that the NASD has made a preliminary recommendation that an enforcement action be brought against the affiliate and one of its registered agents. ING...

Executive Moves.(financial services)
November 8, 2004... Morningstar's Rekenthaler, Reinkemeyer in New Jobs Mutual fund research firm Morningstar has tweaked its management team, naming John Rekenthaler as vice president of new product development and Patrick Reinkemeyer as president of the...

Bush Victory a Boon for Stocks: U.S. Bancorp Predicts 5% Year-End Rally.
November 8, 2004... After months of anticipation and uncertainty, incumbent George W. Bush managed to squeak out a victory over Sen. John Kerry to earn a second term as U.S. commander-in-chief, a decision that drew applause from Wall Street last week. Now that the...

Federated Scoops Up Alliance's Money Funds.(Federated Investors bought money market funds of Alliance Capital Management )
November 8, 2004... In a move industry insiders say indicates that consolidation of the money market fund industry is a sure bet, Federated Investors of Pittsburgh last week announced it was buying $29 billion in money market funds sponsored by Alliance Capital...

The New Partnership Between Transfer Agents, Fund Boards.
November 8, 2004... The troubles that have shaken the mutual fund industry since 2003 have left many scrambling to understand and address a host of proposed changes. Although the regulatory environment has changed significantly, the fact is that the role of...

Domini Tiptoes Into Broker/Dealer Channel.(Domini Social Investments L.L.C.)
November 8, 2004... In most circles, the name Domini is synonymous with socially responsible investing. But for many broker/dealers, the Domini name represents a laudable, but not personally profitable, investment philosophy. Now Amy Domini, president, CEO...

Compliance Rule Deadline is Only the Beginning.
November 8, 2004... From Sarbanes-Oxley reforms to anti-money laundering rules to the USA PATRIOT Act, the rate of regulatory change within the investment management industry has dramatically increased over the last several years. Mutual fund managers now find...

Compliance Professionals Again Take Center Stage.
November 8, 2004... Much as we'd like to move along to something else, we're forced by current events to end the year with yet another discussion of compliance jobs. One year ago, we had Eliot Spitzer to thank for moving the noble profession of compliance...

Managed Account Assets Jump 1.2% to $535B in 3Q.
November 15, 2004... Assets under management in separately managed accounts (SMAs) jumped 1.2% in the third quarter, according to figures the industry's top trade association released last week. The third-quarter report by the Money Management Institute (MMI)...

Wealthy Showing Renewed Confidence in Economy.(Brief Article)
November 15, 2004... America's millionaires showed renewed confidence in the economy in October, according to an index by Spectrem Group. The Spectrem Millionaire Index showed that wealthy Americans were "mildly bullish" at the end of October. The rebound was to an...

Legg Mason, SEC in Talks Over Improper Fund Trades.(Securities and Exchange Commission)(Brief Article)
November 15, 2004... Legg Mason charged itself $1.2 million in the third quarter in anticipation of settlement costs stemming from negotiations with the Securities and Exchange Commission over improper mutual fund trades, a company filing with the Commission shows....

TAs Grapple With Diverse Workforce.(Transfer agents)
November 15, 2004... ORLANDO - Transfer agents are coping with an increasingly difficult recruiting environment these days, as evolving demographic trends have forced them to change the way they approach their service models. Speaking at the annual Investment...

Stiffer SEC Rules Weigh on Fund Ops.(Securities and Exchange Commission)
November 15, 2004... ORLANDO - A number of new regulatory developments have imposed a hefty burden on the back-office and operations personnel employed by most mutual funds, prompting an industry-wide discussion of how to address trouble spots and adapt to a...

Post Scandal, AIM Resumes Building Brand.(AIM Investments)
November 15, 2004... Just weeks after hammering out final settlements with state and federal securities regulators at both its AIM Investments and Invesco Funds Group affiliate, AIM is back to business as usual, the business of branding, that is. On Sunday,...

Investors Coming Around, But Many Wary of Greed.(Brief Article)
November 15, 2004... While investors have improved their confidence in the securities industry since last year, they still have not completely embraced the idea that everything is back to normal, an annual Securities Industry Association survey found. In a...

Privatizing Social Security Could Boost Index Funds.(Brief Article)
November 15, 2004... An overhaul of the nation's Social Security plan, one of the big-ticket items of newly reelected President Bush's second-term agenda, could create a windfall for mutual fund firms specializing in index funds, according to industry insiders. ...

Timing Abuses in Europe Rare, Regulators Discover.(Brief Article)
November 15, 2004... Market-timing and late-trading abuses are rare in the European fund industry, according to a recently published report from a group of regulators in Europe. The Committee of European Securities Regulators (CESR), set out to examine whether...

ICI Head Calls Compliance Critical to Restoring Faith.(Investment Company Institute, Paul Schott Stevens)
November 15, 2004... ORLANDO, Fla. - Speaking at the 2004 Operations Conference and Service Provider Exhibition here, Investment Company Institute President Paul Schott Stevens stressed the importance of funds and their operations support working together with...

Gabelli Portfolio Manager To Oversee Equity Growth.(Brief Article)
November 15, 2004... Gabelli Asset Management has named Howard F. Ward director of growth products, a position in which he will oversee domestic and foreign growth equity products for both mutual funds and separately managed accounts. Ward has been with...

Harvard Professor Perold Joins Vanguard Fund Board.(Brief Article)
November 15, 2004... Vanguard has elected long-time Harvard Business School Professor Andre F. Perold as an independent member of its board of directors. Perold will begin serving at the end of December and also serve on the board of trustees of each of Vanguard's...

Lee to Serve AIM As Head Of Sales Strategy, Planning.(Brief Article)
November 15, 2004... Brian C. Lee is joining AIM Investments as director of sales strategy and planning for its AIM Distributors retail marketing wing. Most recently a director of retail managed accounts for Harris Investment Management, Lee is a 20-year investment...

American Century Hires Perelstein as Vice President.(Brief Article)
November 15, 2004... American Century Investments has hired Michael Perelstein as a vice president and senior portfolio manager of its international equity group. That group manages the American Century International Growth Fund. Formerly the chief investment...

Strides Seen in Corporate Governance Practices.
November 15, 2004... NEW YORK - While corporate governance in the financial services industry has improved markedly over the past year, unsettled problems such as high executive compensation and continued conflicts of interest must be rectified, a top Ernst & Young...

SEC Remains Empty-Handed on New Trading Regs.
November 15, 2004... Although the Securities and Exchange Commission had indicated it would have solutions to eradicate market timing and late trading before the year is up, the Commission is still looking at alternatives to the hard 4 p.m. close and 2% redemption...

Former VP Gore to Launch SRI Mutual Fund.(Vice President, Al Gore, Generation Investment Management)
November 15, 2004... He may not have "invented the Internet" but experts agree that a new mutual fund that former Vice President Al Gore is planning to launch is part of a new movement in socially responsible investing. Gore, along with David Blood, the former...

Baxter, Pilgrim to Pay SEC $160M for Market Timing.(United States Securities and Exchange Commission)(Brief Article)
November 22, 2004... The SEC settled with Harold J. Baxter and Gary L. Pilgrim for fraud charges surrounding undisclosed market timing. Each has been ordered to pay $60 million in disgorgement and $20 million in civil penalties. This, combined with the $90 million...

Franklin to Pay California $18M for Shelf-Space Deals.(Brief Article)
November 22, 2004... Franklin Templeton Investments agreed to pay $18 million to California for failing to disclose it paid brokers for shelf space, Bill Lockyer, the state's attorney general, announced. Of this money, $14 million will be reimbursed to investors,...

Janus Seeks to Retain Primacy in Equity Growth With Three New Funds.(Brief Article)
November 22, 2004... Janus Capital next year will launch three mutual funds in hopes of maintaining its position as an equity growth powerhouse, Reuters reports. The first of the three investment offerings, Janus Research Fund, to be launched in February, will...

Merrill Offers First Fund Listed on China's Exchange.(Brief Article)
November 22, 2004... Merrill Lynch will become the first foreign institution to list a mutual fund on China's exchanges, as it begins selling its latest investment product to domestic investors this week, Reuters reports. The New York-based giant's joint...

529 Assets Rise 5% in 3Q.(529 college savings plans)(Brief Article)
November 22, 2004... Parents faced with the daunting task of paying for their children's college education continued to put cash in 529 college savings plans, as assets rose to $45.1 billion in the third quarter, according to data released last Tuesday by the...

Sihpol Seeks to Sidestep Stint in the Clink: Claims No Legal Precedent for Late Trading.(Theodore Sihpol )
November 22, 2004... In an effort to stave off a lengthy stint in prison, former Bank of America broker Theodore Sihpol has asked a New York judge to dismiss criminal fraud charges against him, according to a motion filed by his attorney last week. Although he...

Mutual Fund Store' Franchises Across U.S.(The Mutual Fund Store)
November 22, 2004... Within a Chicago suburban strip mall in Northbrook, Ill., nestled among the typical fast food, drug store and dry cleaning storefronts, is an unusual newcomer, The Mutual Fund Store. This office is one of a dozen of mutual-fund-only,...

Moral DNA to Rule Risk Self-Assessment: SEC Director Offers Guidance Amid Changing Landscape.
November 22, 2004... ORLANDO - Conducting risk self-assessments has become a paramount concern for mutual funds, as new compliance rules, mounting client demands, product innovations and heavier workloads are all tugging operations personnel in every direction. And...

Long-Term Funds Reap $21.5 Billion in September.
November 22, 2004... Stock and bond funds had inflows of $21.5 billion in September, an increase of $8 billion from a month earlier, according to Financial Research Corp. However, money market funds lost $45.9 billion, bringing both long-term and short-term mutual...

Putnam to Lay Off 100, Adjust Large-Cap Equities.(Brief Article)
November 22, 2004... Putnam Investments announced last week that it will lay off approximately 100 people across all areas of the company, "to improve the operating efficiency of Putnam," Chief Executive Officer Charles Haldeman said in a statement. The...

NYSE Hybrid Plan Worries ICI Due to Hidden Orders'.(New York Stock Exchange)(Investment Company Institute)(Brief Article)
November 22, 2004... The Investment Company Institute has expressed concern about an aspect of the new New York Stock Exchange hybrid market plan. The "broker agency interest file" allows brokers to post orders outside of the best price available that aren't...

Executive Moves.
November 22, 2004... Alliance CEO Sanders Takes on Chairman Title At a time when mutual fund companies are increasingly separating the duties of chairman and chief executive officer, Alliance Capital Management has announced that it was doing just the opposite,...

Rollover Assets to IRA Annuities Surge.
November 22, 2004... As if it wasn't already hard enough for mutual fund companies to attract 401(k) rollovers, investors are increasingly taking this money and putting it in annuities within IRA plans. In fact, these types of rollovers have increased 400% over the...

CFA Institute Floats Code of Professional Conduct.(CFA Institute of Charlottesville)(Certified Financial Analyst)
November 22, 2004... NEW YORK - In conjunction with the launch of its new CFA Centre for Financial Market Integrity, on Nov. 8 the CFA Institute of Charlottesville, Va., floated an exposure draft of its new Asset Manager Code of Professional Conduct. The Code...

NASD Makes Suggestions On Soft Dollars, Disclosure.(Brief Article)
November 22, 2004... The NASD Mutual Fund Task Force made its recommendations on soft dollars and disclosing portfolio transaction costs to the SEC last Wednesday. The task force has asked the SEC to narrow the types of research services that funds may obtain...

SEC to Vote on Reforms To National Market System.(Brief Article)
November 29, 2004... Federal securities regulators are reportedly scheduled to vote Dec. 15 on reforms to the national market system, including a provision requiring brokers to execute customer orders at the best price available regardless of which exchange that...

Oxley, Frank Support SEC Independent Director Rule.(United States. Securities and Exchange Commission)(Brief Article)
November 29, 2004... The Securities and Exchange Commission's new rule requiring mutual fund boards to seat independent directors picked up support last week from two powerful congressional financial services committee members. House Financial Services Committee...

MFS Rebounding From Scandal, Chief Exec Attests.(Brief Article)
November 29, 2004... MFS Investment Management's CEO Robert Manning told a gathering of investors in Toronto, where the firm's parent company, Sun Life, is headquartered, that the firm is rebounding from the mutual fund trading scandal, for which it paid more than...

Putnam Plans to Foster Entrepreneurship But Rumors Abound Company is Up for Sale.(Putnam Investments Inc.)
November 29, 2004... Amid companywide layoffs and speculation about a possible sale, Putnam Investments' chief executive officer says he is confident that the company can get bigger by getting smaller. Ed Haldeman said in a recent interview the company hopes to...

Euro Third-Party Fund Biz Proves Costly: But Sales and Marketing Efforts Show Confidence.
November 29, 2004... Carving out a piece of Europe's retail third-party fund business can be an expensive undertaking, as companies that rely on distributors to sell their funds pay an average of four times more for sales and marketing than the rest of the asset...

SEC Examines Fund Securities-Loan Fees.(United States. Securities and Exchange Commission)
November 29, 2004... Could securities lending be the mutual fund industry's next ticking time bomb? Lori Richards, director of the office of compliance, inspections and examinations at the Securities and Exchange Commission has warned investment companies that...

October Equity Fund Inflows, Rally May Signal Prosperity.
November 29, 2004... October was a positive month for equity mutual funds, which took in $15.3 billion, Lipper reported. The company compared the month's stock market rally to a similar period of good fortune in 1934, calling it a potential signal that the coming...

Executive Moves.
November 29, 2004... SEC Promotes Three to Assoc. Regional Directors The Securities and Exchange Commission has promoted three individuals in its Northeast regional office to associate regional directors. The three individuals, Helene Glotzer, David Rosenfeld...

State Street Becomes First 529 Dropout: More Managers Expected to Exit State College Savings Plans.
November 29, 2004... Although 529 college savings plans continue to celebrate tremendous growth, the first 529 plan manager is dropping out, and industry experts predict more truancies to come. The College Savings Foundation recently touted a 55% increase in...

529 Plans Get More Conservative as College Approaches.
November 29, 2004... As individuals investing in 529 college savings plans draw nearer to entering college, their investment tastes become more conservative, according to recent research from the College Savings Foundation. CSF, a not-for-profit...

Nations Funds Boots Team-Managed Concept.
November 29, 2004... Nations Funds, the mutual fund group managed by Bank of America Capital Management (BACAP), has given its team-managed approach the boot, at least on its two dozen fixed-income funds. In a Nov. 17 filing with the Securities and Exchange...