Money Management Executive Latest News

A heightened regulatory environment has forever changed the $8 trillion mutual fund industry, as the fallout from a wave of scandal has had a significant impact on its various operating facets, a reality that has put its member firms at the crossroads.

United States District Judge Andre M. Davis dismissed all remaining civil charges last week against former Bank of America executive Charles Bryceland on mutual fund timing and late trading. Although the Securities and Exchange Commission, NASD and New York Attorney General have never charged Bryceland, he was named and then dropped as a defendant in a number of earlier cases.

Speculation that Marsh & McLennan might spin off its scandal-plagued Putnam Investments unit continues, with a report last week that a sale, merger or management buyout are all possibilities. The fact that MMC has been caught up in an $850 million settlement makes a sale even more likely, because Putnam would probably fetch that amount or even far more. According to one analyst, Putnam accounts for nearly half of MMC's $32 stock value, which could put its price tag as high as $8 billion. However, if management were to buy the firm, it would probably cost between $4 billion and $6 billion, based on traditional valuations of 2% to 3% of assets.

Due to what sources say are conflict of interest issues, Ernst & Young is said to be closing its financial advisory services unit, a move that would eliminate several hundred positions and leave clients scrambling.

Russell Taps Romberger, Highland, Day as Directors

Investors poured $4.5 billion into equity funds during January, more than a $7 billion drop from December, according to Lipper of New York. Domestic stock funds were hit hard, but exchange-traded funds experienced a significant milestone.

What's the recipe for a great 529 college savings plan?

The Independent Directors Council has just released a task force report on how mutual fund boards might best approach self-evaluation, an annual checkup that will become mandatory next year, and while the 28-page document stops short of issuing any rigid mandates, it clearly urges directors to play a more active role in fund management.

MIAMI- Jack Brennan, chairman and chief executive of the Vanguard Group, blasted rival investment products such as hedge funds and separately managed accounts last Monday and defended the mutual fund industry against mounting criticism.

A former managing director at insurance giant Marsh & McLennan pleaded guilty in New York Supreme Court last week to bid-rigging and price-fixing.