Special Program Root Tag

Charles Schwab has agreed to settle a federal class-action lawsuit related to its YieldPlus Fund for $200 million, far less than the $800 million plaintiffs had sought.

NEW YORK—Japan is the most energy-efficient country in the world, using nearly half the energy consumption per GDP of the United States and nearly one-eighth less than India and China, said Shuhei Abe, portfolio manager of the Hennessey Select SPARX Japan Fund.

WASHINGTON — Jafor Iqbal wonders if advisers are from Mars and retirees are from Venus.

XBRL US is working on applications for Apple’s iPhone and newly release iPad. The goal is to demonstrate the power of XBRL in a simple and accessible way, said XBRL US President and Chief Executive Mark Bolgiano.

WASHINGTON — The political pressure to enact financial reform intensified Friday as the government accused Goldman Sachs Group of defrauding investors and the Senate concluded two days of hearings highlighting the allegedly lax supervision that preceded the largest bank failure in the country's history.

Arch Bay Capital, an active buyer and seller of non-performing, or defaulted, mortgages, is on the verge of jumping into the origination market and is busily gathering lending licenses in several states, according to officials briefed on its plans.

Investors pulled $324.4 billion from money market mutual funds in the first quarter, the largest quarterly outflow ever tracked by Morningstar. Approximately $148.2 billion left the funds in March, Morningstar said.

Eaton Vance Management has launched an income mutual fund that seeks to earn returns above inflation by investing in short-and intermediate-maturity Treasury Inflation Protection Securities (TIPS), as well as floating-rate corporate loans and other instruments.

John Hancock Funds has made its new natural resources fund available to retail investors through their financial advisers.

Investor confidence in hedge funds appears to be making a comeback. Just over $1 billion of net investments moved to hedge funds in the third quarter of 2009, the first quarter of inflows since mid 2008, according to Hedge Fund Research.

As mutual fund companies turn out derivatives- and leveraged-laden offerings, regulators are becoming increasingly concerned that funds, and the financial industry at large, are forgetting the lessons of the Great Recession by returning to complicated, high-risk products.

Manning to Replace Pozen As Chairman of MFS

Assets in 401(k) plans and other retirement accounts are up 18% from a year ago and have nearly erased losses from the recession as investors continue to pump money into their plans and take advantage of lower prices, according to a report from the Spectrem Group.

Money market funds are the stepchildren of finance. Though they manage more than $4 trillion in assets, they have not gotten much attention recently. Sen. Chris Dodd (D-Conn.)'s regulatory reform proposal does not even mention money market funds, which we believe is a glaring mistake.

As sentiment among wealth managers shifts, more capital has become available and companies right-size, banks, trust companies, wealth managers, and bank brokerages that are in a strong position to expand into a new market and acquire new units, will do so. But it is also the moment when companies without the capital-and stability-will get left behind.

Stock Fund Fees Edge up 2 BPS to 0.86%

The collateralized debt obligation at the center of the fraud case against Goldman Sachs is known as ABACUS 2007-AC1, and a class of its debt was cut to "D" from "CCC-" by Standard and Poor’s in May 2009.

SEC Charges Goldman With Civil FraudRegulator alleges misleading statements and omissions regarding subprime securities.By Lee Conrad, On Wall StreetThe Securities & Exchange Commission sued Goldman Sachs for securities fraud today, saying that the financial powerhouse made “materially misleading statements and omissions” regarding a structured product sold to investors.The product was tied to the performance of subprime residential mortgages and was structured and marketed in early 2007, just when the U.S. housing market first showed signs of strain, the suit said.The SEC alleged that investors were not told that hedge fund Paulson & Co. had a hand in the selection of residential mortgages that were part of the structured product. Paulson subsequently made a profit of about $1 billion from this product by betting that the housing market would fall.After the selection of the portfolio for this product, Paulson effectively shorted the residential mortgage backed market by using credit default swaps. The suit says that “Paulson had an economic incentive to choose [residential mortgages] that it expected to experience credit events in the near future.” And Goldman’s product did not disclose Paulson’s contrarian economic interests. Indeed, Paulson’s selection process for this product favored borrowers with adjustable rate mortgages, relatively low FICO scores, and who were located in states like Arizona, California, Florida and Nevada, which had recently experienced steep inclines in home value.Goldman said in a statement that the SEC’s charges are “completely unfounded in law and fact and we will vigorously contest them and defend the firm and its reputation.”The Securities & Exchange Commission sued Goldman Sachs for securities fraud Friday, saying the financial powerhouse made “materially misleading statements and omissions” regarding a structured product sold to investors.

PIMCO Exec Seeks Money Fund ReformMoney funds should be regulated like banks, McCulley said.JMMoney market mutual funds contributed to the instability of the financial system and should not exist in their current form, said Paul McCulley, a managing director at PIMCO, at a Levy Economics Institute conference last week.McCulley, who runs PIMCO's approximately $500 million money market fund, said the temporary run on money funds in the wake of the collapse of Lehman Brothers in 2008 showed that money funds need an emergency capital backstop to prevent future runs. If such a backstop is granted, the funds should be regulated like banks, he said.McCulley's remarks followed a call by former Federal Reserve Chairman Paul Volcker for tighter restrictions on the types of assets in which money funds can invest.Money market mutual funds contributed to the instability of the financial system and should not exist in their current form, said Paul McCulley, a managing director at PIMCO, at a Levy Economics Institute conference last week.

Morgan Keegan Reassures InvestorsFraud probe won't harm accounts, CEO says.JMIn a letter to investors, Morgan Keegan & Co. CEO John Carson said that recent fraud charges against the company by state and federal regulators won't harm its accounts and added that the firm intends to defend itself against the charges."First and foremost, I want to reassure you of the safety of your accounts held with Morgan Keegan," Carson said last week. "These charges, which relate to a mutual fund management business that was sold in 2008, should not be construed as claims against the business of the firm as a whole."Morgan Keegan has been accused by the Securities and Exchange Commission, Financial Industry Regulatory Authority and a number of states of manipulating prices on subprime securities.In a letter to investors, Morgan Keegan & Co. CEO John Carson said that recent fraud charges against the company by state and federal regulators won't harm its accounts and added that the firm intends to defend itself against the charges.