As rumors circulate about a potential $300 million settlement between MFS Investments and regulators, the beleaguered fund firm may be dealt another blow as the SEC is considering punishing two of its top officials for failing to supervise activities, Reuters reports.
Firm CEO John Ballen and CIO Kevin Parke may face sanctions ranging from a fine to a temporary suspension. Both Ballen and Parke have hired separate independent counsel and the firm would not comment on negotiations ( See "MFS CEO Hires Securities Fraud Lawyer," MME 1/28/04).
MFS, the 11 th largest fund firm in the nation, announced earlier that it expected regulators to bring charges in relation to market timing issues at the firm. More recently, reports have indicated that investors were significantly damaged by a rash of late trading episodes at MFS, as well.
If the duo were to be suspended permanently, or even on a temporary basis, they could be forced from their jobs at MFS, according to analysts and lawyers, Reuters reports.