Following The Boston Globes report Tuesday that Putnam Investments will be charged with at least two counts of civil securities fraud within the next few days, Massachusetts Secretary of State William F. Galvin confirmed to Reuters he is weighing this serious matter. He said he will make a decision in the next few days emphasizing that market timing is far more widespread than he originally thought.
Galvins investigation into the mutual fund industry mirrors that of New York Attorney General Eliot Spitzer. Sources told The Globe that Putnam will be charged with allowing certain clients to rapidly trade in and out of its funds. As a result, the nations fifth-largest mutual fund firm gave those investors an unfair advantage over other shareholders.