Franklin Resources Inc. said in a filing that it may be in trouble from the state of California for revenue-sharing payments made to brokerage fims, Dow Jones reports. In addition, the company said California Attorney General Bill Lockyer told the company that enforcement action would be authorized.

The news comes seven months after Lockyer announced a deep look into revenue sharing between mutual funds, including Franklin, and brokers. Neither California nor Franklin would confirm to Reuters on whether a whether a settlement or a lawsuit is upcoming.

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