MFS CEO John Ballen has hired a leading securities fraud lawyer and has met with the funds’ board, Reuters reports.

John Falvey, a partner at Testa, Hurwitz & Thibeault who has handled a number of white-collar cases and who is a former assistant U.S. attorney, is on the case, Reuters confirmed yesterday.

MFS reportedly allowed certain clients, particularly hedge funds, to market time 11 of its funds, sources said. The firm is currently negotiating a settlement with the SEC, the New York attorney general and New Hampshire regulators.

Also, the company earlier this month replaced MFS Chairman Jeffrey Shames as the chairman of the funds’ board, replacing him with Atwood Ives and Ward Smith as co-chairmen.

Falvey and MFS spokesman John Reilly both declined further comment yesterday.

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