MFS Near Settlement with Spitzer, SEC

Published December 29, 2003, 1:00 a.m. EST

1 Min Read

Sun Life Financials Massachusetts Financial Services subsidiary could strike a deal with New York Attorney General Eliot Spitzer and the U.S. Securities and Exchange Commission as early as this week, the Toronto Globe and Mail reports.

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While Spitzers office is concentrating on improper trades at MFS and the SEC is focusing on breaches of fiduciary duty the regulators different areas of focus is what is holding up a settlement, according to the Globe and Mail, quoting people briefed on the situation.

"The whole idea is to try and announce the settlement with the regulators at the same time, and that would be our objective, too," a person "close to Sun Life" told the paper.

More importantly, according to another source, Sun Life is resisting slashing fees. Two weeks ago, in a landmark $600 billion settlement, Alliance agreed to cut its fees by 20% over the next five years, for a total value of $350 billion news that has startled the mutual fund industry. ( See "Alliance Deal Sets Alarming Precedent," MME 12/22/03).

Meanwhile, Manulife and John Hancock revealed in regulatory filings last week that they are conducting internal investigations a possible tip-off that regulators are breathing down their backs.

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The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.