The SEC and New York State’s Attorney General Eliot Spitzer’s office have settled their cases in federal district court with Pilgrim Baxter & Co. The company has agreed to pay the SEC $40 in disgorgement and $50 million in civil penalties for allowing select clients to market time its funds. In addition, the company has agreed with Spitzer’s office to reduce management fees by 3.16% over a five-year period, a settlement valued at $10 million.

Stephen M. Cutler, director of the SEC’s division of enforcement, characterized the sum as "an important milestone for mutual fund shareholders."

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