Investors have filed a
"The proprietary funds were poor performers in relation to the rest of the market," according to the suit. "Moreover, defendants improperly charged and collected excessive fees and used those fees to compensate SSB financial advisers for steering more clients to the proprietary funds, thereby perpetuating the unlawful and deceitful scheme," it continues.
To encourage SSB advisers, managers and branch managers to push proprietary funds, the firm allegedly offered 12b-1 fees, directed-brokerage payments, commissions, as well as non-monetary compensation, which it only made known in a prospectus dated March 22, 2004. The plaintiffs seek compensatory damages, the return of all fees and coverage for legal costs.
The suit, being filed by the law firm of
