To fight charges that it allowed a hedge fund to trade illegally, Bank of America has hired the New York law firm Wilkie Farr & Gallagher to handle its case.

"We are assisting the independent directors in their investigation to determine whether trading in fund shares, sales and redemptions [was] done in accordance with law and the funds’ policies," the firm’s Burton Leibert told Reuters. In addition, BoA will retain Deloitte & Touche to assess how badly shareholders were affected if the charges are, in fact, true.

New York Attorney State General Eliot Spitzer charges accuse Bank of America’s Nations Funds unit of allowing hedge fund giant Canary Capital to trade four funds after hours, and specifically tabbed former broker Theodore Sihpol with grand larceny and securities fraud counts. The head of Nations Funds, Robert Gordon, is among other Bank of America employees who have been fired since Spitzer’s wide-ranging probe commenced.

Meanwhile, for Putnam Investments, No. 5 among U.S. mutual fund companies, the firm of Skadden, Arps, Slate, Meagher & Flom has been hired to deal with a deepening investigation into some questionable trading tactics that Massachusetts regulators are looking into. This case involves market timing.

Putnam received subpoenas from Massachusetts securities regulators last week regarding the question of whether it allowed certain clients to utilize market timing techniques to quickly buy and sell shares within one of its funds. The Massachusetts regulators are also investigating similar practices by Prudential Securities, which has hired Boston-based Bingham McCutchen as its law firm.

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