The Securities and Exchange Commission said it would distribute millions of dollars to investors harmed by market-timing trading violations in mutual funds managed by Putnam Investment Management and Janus Capital Management.
More than 1.5 million Putnam investors will receive more than $150 million from the distribution plan, while more than 325,000 Janus investors will get over $18 million from the SEC Fair Fund. The Janus distribution is the first in a series that will return approximately $100 million to harmed investors as part of the SEC's 2004 settlement with Janus.
In October 2003, the SEC and the Massachusetts Securities Division brought separate administrative proceedings against Putnam. In April 2004, Putnam agreed to pay disgorgement and financial penalties and to implement compliance, mutual fund governance and employee-trading reforms.
The SEC brought and settled public administrative and cease-and-desist proceedings in 2004 against Janus. Without admitting or denying the allegations, Janus consented to a commission order charging anti-fraud violations and requiring it to pay $50 million in disgorgement and $50 million in civil penalties.
