Putnam Investments took the initial hit from the rash of sales and marketing executives defecting to Liberty Financial in the late 1990s, but it is Columbia, which since consumed Liberty, that is now poised to take a beating from the transaction.

Regulators have filed charges against Columbia that could result in the firm being barred from managing its own mutual funds. Reportedly in the thick of the alleged wrongdoing are the two former co-presidents of its distribution unit, both of whom hail from Putnam.

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