Special Program Root Tag

The U.S. Treasury has proposed a rule that all mutual fund companies be required to report any suspicious financial transactions, hoping to net drug dealers, terrorists and money launderers. The new rule would require mutual funds to file such reports within 180 days of such suspicious transactions involving $5,000 or more.

The Securities and Exchange Commission has issued a cease-and-desist order against Unified Fund Services, a transfer agency, fund administration and accounting firm, and its former vice president of fund accounting, Michael E. Durham. The firm has also been ordered to pay a $125,000 civil penalty.

Attorneys with Schiffrin & Barroway plan to file a class-action lawsuit in the United States District Court for the Eastern District of New York on behalf of investors who purchased shelf-space funds from American International Group's Advisor Group broker/dealers between June 30, 2000 and June 8, 2005.

DWS Scudder Expands Sales Group With 15 Hires

In the frenzy to compete for the attention of America's 79 million Baby Boomers, mutual fund companies might be missing the next big business bang: the Hispanic market.

The Potomac Funds of New York, which manages $1 billion in predominantly indexed, leveraged index and inverse indexed mutual funds, has adopted a new brand identity, Direxion Funds. The shop has also opened up a Boston sales, marketing and fund distribution office, hired a new chief executive officer and is ramping up its fund lineup as well as its fund wholesaler ranks.

Too many asset management firms continue to hold an outdated view of their advisers, defining them as either a "prospect" or a "producer." Producers are courted; prospects are bombarded with sales literature. Both approaches are less than optimal for attracting and retaining new assets in the current market environment and need to be replaced with a more effective framework for communicating with this customer base.

Americans are woefully ill-prepared for retirement and have unrealistic expectations about how much money they should save for their golden years. As a result, many people could face the prospect of working far longer than they expect, but, in reality, may be unable to do so due to declining health or corporate downsizings.

A review of recent NASD actions and notices to members suggests that older issues remain a priority for examiners, but some new topics are now raising regulatory eyebrows. The lesson learned from prior actions against member firms is that NASD is resolved to take a strong position on a regulatory issue, even on issues not immediately evident to the industry.

As industry dialogue about separately managed account (SMA) platforms has shifted beyond connectivity to flexibility, providers are responding to asset managers' key question: "How can we profitably capture a piece of the SMA growth?" Assets in this type of structure are expected to exceed $1 trillion by 2008.

As the mutual fund industry wrestles with the details of SEC's Rule 22c-2, it's important that we as an industry don't miss a significant opportunity. Rule 22c-2 presents the industry with the ability - and arguably, the obligation - to ensure that trades within omnibus accounts are held not only to a fund's short-term trading rules, but to all fund prospectus policies and procedures.

Fidelity Investments' clearing services unit has expanded its client roster 129% since 2003, and the company expects to continue adding share as industry consolidation continues.

A high-net-worth client of Peter S. Izzo, a wealth adviser with Merrill Lynch, recently came to him seeking to allocate a small percentage of his portfolio to emerging markets. The client, a retiree in his fifties who once ran a public company, wanted to select four or five countries with the best potential return.

The nation's 79 million Baby Boomers are a generation unlike any to come before it, and as a result they'll require a unique brand of investment regulation, according to Securities and Exchange Commission Chairman Christopher Cox.

Being too optimistic can lead to disappointment. That is precisely the lesson Wall Street learned, when Legg Mason's fiscal fourth quarterly earnings, while up 28%, failed to meet analysts' expectations, The Wall Street Journal reports.

The two former chief executives of Enron, the firm that defrauded investors, could be found guilty of consciously avoiding knowing about the illegal behavior that went on in the company, The Wall Street Journal reports.

The two former chief executives of Enron, the firm that defrauded investors, could be found guilty of consciously avoiding knowing about the illegal behavior that went on in the company, The Wall Street Journal reports.

The Nasdaq Stock Market has raised its stake in the London Stock Exchange to 24.1%, increasing its position as the biggest shareholder of the LSE even further, Reuters reports.

Investors keep pouring cash into commodities, unaffected by the record prices, U.S. regulatory changes and the unusual structure of the oil market. In fact, in 2006 commodities are set to hit $3.5 billion, Reuters reports.

New York Attorney General Elliot Spitzer is nearing the end of a two-year-long investigation into how public and private retirement plans select investment options, and whether undisclosed financial arrangements affect those decisions, the Los Angeles Times reports.