The
Putnam promised the Boilermakers annual rebate checks of $40,000, according to The Journal, citing sources and documents, including e-mails. Among the e-mails regulators are investigating, is one mentioning a $400 check to the Boilermakers for an "annual golf tournament registration fee."
Putnams top retirement plan attorney, Ralph Derbyshire, issued a statement saying that in cases where 401(k) plan sponsors absorb administrative costs that could be charged directly to plan participants, Putnam occasionally issues rebates. Further, Derbyshire said, the money comes out of Putnams corporate assets, not from the underlying mutual funds marketing fees.
If regulators find that the rebates created an unlevel playing field for 401(k) plans, Massachusetts Secretary of the Commonwealth
One of the reasons that Massachusetts has not yet reached a settlement with Putnam, sources said, is because of Galvins ongoing investigation into its 401(k) rebates. On top of this, New York State Attorney General Eliot Spitzer is investigating Putnams use of marketing fees in 401(k) plans.
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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.
