Reserve Funds has added insult to injury, literally, to the investors in its Primary Fund. The fund, which broke the buck on Sept. 16 and has been struggling to return investors’ assets ever since, is now valuing the remaining balance at 98.5 cents per share.

If the fund company goes to court over the numerous lawsuits that have been levied against it, that figure could become much lower, as the firm will deduct legal fees, Reserve said.

The firm also indicated that it believes it is in the best interest of shareholders to wait until its holdings mature, in order to provide the highest payout; the oldest $5.4 million debt does not mature until Oct. 15, 2009.

“This is a complicated and unprecedented situation,” a Reserve spokesman told The New York Times. “The trustees are acting in good faith to treat all shareholders fairly and equitably."

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.

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