Want the latest retirement plan adviser news and insights? Sign up for PLANADVISER newsletters.
Compliance July 11, 2007
SEC Reveals $37M Columbia Market Timing Distribution
The Securities and Exchange Commission (SEC) on Wednesday announced a $37 million payout to more than 300,000 investors who were harmed by Columbia Funds’ fraudulent mutual fund market timing between 1998 and 2003.
Reported by Fred Schneyer
An SEC news release said the payment is the first in a series of disbursements from the Fair Fund that will distribute a total of approximately $140 million to more than 600,000 affected Columbia Funds account holders.
The fund resulted from a commission enforcement action charging unlawful conduct by Columbia Management Advisors, Inc. (the adviser to the Columbia Funds) and by Columbia Funds Distributor, Inc. (the Fund’s underwriter and distributor) by allowing undisclosed market timing in the funds, the announcement said.
In 2005, the commission brought and settled public administrative and cease-and-desist proceedings against Columbia Management Advisors and Columbia Funds Distributor, which consented to a commission order charging anti-fraud violations without admitting or denying the commission’s findings. The commission ordered Columbia to pay $70 million in disgorgement and $70 million in penalties for distribution through the Fair Fund.
The commission anticipates that approximately four additional distributions from the Fair Fund will be made to Columbia Funds account holders to complete the distribution process.
Investors can obtain additional information about the distribution process, including a copy of the Distribution Plan, by visiting http://www.columbiafairfund.com or by calling the Administrator of the Distribution Plan at (800) 410-5361.