Investors noting the one-year anniversary of landmark indictments brought against mutual fund companies by New York Attorney General Eliot Spitzer are still waiting for promised settlement payments, and growing increasingly restless, The Atlanta Journal Constitution reports.
Approximately 10 mutual fund providers are bound to pay restitution for various misdeeds, but so far, investors have not yet received a cent. The Securities and Exchange Commission insists each mutual fund provider hire an outside auditor to oversee the payments. Some of the plaintiff firms have publicly vowed to do the SEC's bidding but quietly groused about the expense of hiring a consultant.
Regulators' provisions for compensating investors also require the mutual fund providers to submit individual plans for completing the process within six to eight months. Alliance Capital Management, one of the firms named by the SEC, has already missed its deadline. A spokesman for Alliance said $250 million earmarked for investors has already been deposited with the SEC.
Investors are owed more than $1.5 billion from the penalties and funds set aside for restitution by the 10 mutual fund providers. The fund providers are also expected to sweeten the settlement with $845 million in combined fee reductions.