The Massachusetts state pension board announced last week that it will not invest any new money in Fidelity Investments, reprimanding the world's largest fund company for the manner in which it has responded to the board's questions regarding a federal investigation of its trading desk.

Evoking memories of its fallout with Putnam Investments over market-timing allegations, the Pension Reserves Investment Management Board (PRIM) withheld a $75 million high-yield investment from Fidelity, suggesting that the company has been less than forthcoming about a Securities and Exchange Commission investigation of whether its traders accepted lavish gifts from brokers as incentives to trade with them.

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