Money Management Executive
California A.G. Probes Franklin, PIMCO, American Funds Reports
January 05, 2004, 1:00 a.m. EST 1 Min Read
California Attorney General Bill Lockyer has subpoenaed a number of leading mutual fund names in the state, his office announced Friday.
Lockyers office began the probe in conjunction with a new law broadening its powers. Franklin Templeton, PIMCO and American Funds are among those the office has contacted, according to reports. Heretofore, PIMCO and American Funds are two names that have not been sullied by the scandal.
California is looking into whether the funds failed to reveal to investors that they rewarded brokers higher commissions for touting their funds. Morgan Stanley recently reached a $50 million settlement with the SEC for such directed-brokerage practices, and that case implicated PIMCO and American Funds, according to a source.
Lockyers office declined comment for TheStreet.com on the matter.
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