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Rating:SEC Unveils Fair Fund Plan For One Group Funds Not Rated 0.0 Email Routing List Email & Route  Print Print
Monday, August 13, 2007

SEC Unveils Fair Fund Plan For One Group Funds

News summary by MFWire's editors

The SEC has announced a distribution plan for $55.6 million in Fair Funds to 200,000 investors hit by market timing within certain One Group Funds. The SEC brought administrative and cease-and-desist proceedings (now settled) against Banc One and Mark A. Beeson, former President and CEO of One Group Funds in June of 2004.


The Securities and Exchange Commission today announced the distribution of approximately $55.6 million in Fair Funds to more than 200,000 investors who were harmed by fraudulent market timing in certain Banc One mutual funds (One Group Funds). The Fair Fund resulted from a settled enforcement action in which Banc One Investment Advisors Corporation (BOIA) agreed to pay $10 million in disgorgement and $40 million in civil penalties to settle charges of unlawful market timing. The entire Fair Fund, plus accumulated interest, has been distributed to investors.

ďReturning money to investors injured by the unlawful market timing in this and other matters marks the continuation of the SECís efforts to remedy the harm suffered by investors,Ē said Linda Chatman Thomsen, Director of the SECís Division of Enforcement.

The Sarbanes-Oxley Act of 2002 gave the SEC authority to increase the amount of money returned to harmed investors by allowing civil penalties to be included in Fair Fund distributions. Prior to SOX, only disgorgement could be returned to investors. To date, the SEC has distributed more than $2.5 billion in Fair Funds to injured investors.

On June 29, 2004, the SEC brought settled administrative and cease-and-desist proceedings against BOIA and Mark A. Beeson, former President and CEO of One Group Funds. Both consented to the settled order without admitting or denying the SECís findings. The SEC found that BOIA improperly allowed market timing in One Group Funds between June 1999 and May 2003, failed to charge required redemption fees in One Group Fundsí international funds, and improperly released confidential portfolio holdings. In addition to disgorgement and civil penalties, BOIA also consented to a cease-and-desist order and a censure, and agreed to undertake certain compliance and mutual fund governance reforms.

The Fair Fund Administrator responsible for distribution is Boston Financial Data Services, Inc. (BFDS). Investor questions regarding the distribution may be directed to BFDS at (800) 261-0282. Information regarding the distribution can also be obtained at the BOIA Web site: http://www.settlementbanconeia.com. 

Edited by: Erin Kello


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