WEST PALM BEACH, FL (HEDGECO.NET) – Janus Capital Group has agreed to pay $200 million to settle the illegal mutual fund trading allegations, according to Bloomberg news. According to the report,Janus has reached settlement with the U.S. Securities and Exchange Commission. The payment also includes fee reductions as well. Such agreement may bring this episode to an end, since it alsoincludes the state of New York and Colorado.
According to Elliot Spitzer, New York Attorney General, Janus permitted investors such as Canary Capital Partners LLC hedge fund to make frequent, short- term trades in its funds; such practice has been referred to as market timing. Most money managers do not permit market timing. According to them, such practice may impact on returns for other investors who subscribe to the �buy-and-hold� strategy, by pushing up transaction costs.
Officials involved with the negotiations declined to make specific comments about the settlement, however the Colorado Securities Commissioner Fred Joseph, who’s working on the case said, �I’d have to believe we’re a short way away.�
Janus Capital Group manages an estimated US$145 billion of investor assets. The asset manager has become the sixth company to be penalized by state and federal regulators over the mutual fund scandals of 2003. According to published reports, a total of about $1.7 billion has been levied against such firms. Bank of America Corp. agreed to pay back $675 million in March to settle with regulators.
Janus spokesman Blair Johnson said, �We’re having continuing discussions with the regulators, but we can’t be specific on what might happen.�
Paul Oranika
Editor-in-Chief
HedgeCo.Net
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