Practice

The NASD has fined Citigroup Global Markets $250,000 for distributing inappropriate hedge fund sales literature. The penalty marks the agency's heftiest fine for abusive hedge fund sales practices by broker/dealers.

The Securities and Exchange Commission reportedly fears that investment companies may have paid retirement-plan consultants in order to steer business their way. A probe that began last December looking into possible conflicts of interest in the financial-services industry has uncovered troubling evidence of improper payments to the pension planners, according to the SEC.

It's official. In a highly anticipated move, the Securities and Exchange Commission voted 3-2 in favor of requiring hedge fund managers to register as investment advisors with the agency last week.

Larry Lasser: $78 million.

NEW YORK -- Some fund investors have lost that loving feeling.

The Securities and Exchange Commission's ban on funds directing trades to brokers in exchange for shelf space, or directed brokerage, has mutual fund companies scurrying for new ways to compensate distributors.

Who says there is no such thing as a free lunch? While regulators are pushing to clean up the fund industry, some short-term shareholders are continuing to eat away at returns of other investors by driving up costs and benefiting from an inefficient system.

Marsh & McLennan is under the regulatory gun again, and although the new probe is not related to business at its mutual fund unit, Putnam Investments is sure to suffer some fallout, industry experts say.

The Securities and Exchange Commission is investigating FMI Mutual Funds for possible improper trading practices, the company indicated in a regulatory filing. FMI disclosed that the Commission has opened an informal probe into a 2002 security trade by the former employer of an FMI principal. The principal and former employer were not identified, but the manager of the FMI-affiliated Cortina Funds, Cortina Asset Management, is the sub-adviser in question.

Brokerage firm A.G. Edwards announced that the Justice Department is looking into possible improper trades at the company. While the brokerage firm did not go into specifics or indicate whether it has been subpoenaed, it did admit that it could face some regulatory action for "timing transactions."