The Securities and Exchange Commission has joined Massachusetts Secretary of the Commonwealth William Galvins probe into the mutual fund trading practices of Prudential Securities, Reuters reports.
SEC investigators descended upon Prudentials Boston office, looking for evidence and planning to speak with employees, according to Reuters. Galvin has already subpoenaed Prudential for documents.
Both the SEC and Prudential declined to comment on the investigation, details of which have not been made public. In New York Attorney General Eliot Spitzers probe of mutual funds, the practice in question is late trading, whereby fund companies allowed investors to buy a funds net asset value after the market close, rather than requiring them to buy at the next days NAV. This allegedly allowed hedge funds and other institutions to trade on market-moving information and take advantage of potential price discrepancies in the NAVs.
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.