American International Group
has been hit with a class action lawsuit brought on behalf of investors in Fidelity
mutual funds. The suit, filed by law firm Schiffrin & Barroway, LLP
in the US District Court of the Eastern District of New York, alleges that AIG and some of its affiliated entities did not properly disclose that they had been pushing sales personnel to sell certain funds that provided incentives to AIG.
According to the complaint, which was filed on behalf of purchasers of 165 Fidelity funds from the AIG Advisor Group from June 30, 2000 to June 8, 2005, the defendants steered clients to pre-selected funds, the sales of which increased the defendants' overall profits, but diminished investors' returns.
The AIG Advisor Group included Royal Alliance Inc., SunAmerica Securities Inc., FSC Securities Corp., Sentra Securities Corp., Spelman & Co. Inc. and Advantage Capital Corp. during the class period.
Besides Fidelity, other fund firms said to have struck shelf-space agreements with AIG include AIG SunAmerica, AIM, AllianceBernstein, American Funds, American Skandia, Columbia, Fidelity, Franklin Templeton, Hartford, John Hancock, MFS, NationsFunds, Pacific Life, Pioneer, Putnam, Oppenheimer, Scudder, Van Kampen, and WM Funds Distributor, Inc.
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