The Securities and Exchange Commission recently suspended and fined two brokers with Wachovia Securities $250,000 each for their roles in a market-timing scheme that cost mutual fund shareholders hundreds of thousands of dollars in losses, writes The Miami Herald.Thomas C. Bridge, 41, of Fort Lauderdale and James D. Edge, 46, of Lake Worth, both worked at Wachovia's Boca Raton office. Edge was Bridge's supervisor.According to Judge Brenda Murray, Bridge engaged in numerous market timing trades, prompting complaints from mutual fund companies. Instead of stopping Bridge, Edge helped him circumvent trading restrictions, including the use of multiple account numbers and broker ID numbers to hide transactions.Bridge has been suspended for a year and Edge has been suspended for 30 days, with the stipulation that he never be a supervisor again.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.

A federal judge in Pennsylvania has given final approval to a $14 million settlement against New York Life Insurance Co. by employees who said the company’s retirement plans were improperly invested into mutual funds owned by New York Life.

A proposal by the Securities and Exchange Commission to shorten mutual fund disclosure statements is meeting widespread support, and a new rule could take effect by 2009, if not sooner.

The British government is considering an overhaul of their tax code for mutual funds that could put the responsibility for declaring income from funds directly on investors, according to foreign news reports.

The bonuses and pay packages of the chief executives at Countrywide Financial Corp., Citigroup Inc., and Merrill Lynch & Co. were not made in the interest of the companies’ shareholders, particularly as the subprime crises was unfolding, according to a report from a U.S. House committee.

The Securities and Exchange Commission has filed an order against a top advisor at Fidelity Investments, after a four-year investigation into the inappropriate use of gifts and the entertainment of prospective clients.

As part of a settlement with New York Attorney General Andrew Cuomo, Fannie Mae and Freddie Mac will establish a home appraisal watchdog organization to help prevent fraud in valuing homes, Reuters reports.

WASHINGTON - House Financial Services Committee Chairman Barney Frank is preparing a $35 billion housing package that would expand the government's role in combating the sub-prime mortgage crisis.

After years on the back burner, the Securities and Exchange Commission's rule governing mutual fund marketing fees is in store for a "complete overhaul," according to commission chairman Christopher Cox.

WASHINGTON – House Financial Services Committee Chairman Barney Frank is preparing a $35 billion housing package that would expand the government's role in combating the sub-prime mortgage crisis.

Oppenheimer & Co. has been ordered to pay $250,000 for failing to supervise the improper market timing of mutual fund shares from January through September 2003, according to FINRA. The firm has also been ordered to pay $4.25 million in restitution to more than 60 mutual fund companies.

The Securities and Exchange Commission said it wants to require investment advisers to provide clients with online brochures describing their services, fees and conflicts of interest in a reader-friendly format.

Investors holding municipal bonds directly or through mutual funds could see their returns diminished by ratings agencies' recent downgrades of troubled bond insurers, according to a report prepared for Congress.

WASHINGTON-Democratic leaders of the House Financial Services Committee are exploring creating a federal regulator or modifying a multi-state compact to increase oversight and provide more uniform standards for insurers of municipal bonds and other financial products.

The Supreme Court's decision in Stoneridge Investment Partners LLC v. Scientific Atlanta will mean that mutual fund companies, could be better protected from class-action investor suits involving third parties that support the administration and running of a fund's trading floor and back office.

BOSTON - Fund companies will need to plan ahead to ensure they can meet new regulations on fund disclosure without costly delays to investors and brokers.

The rapid growth in the exchange-traded fund arena is increasing the complexity of capital gains taxes, writes the Wall Street Journal.

In a move that could change the way brokers and advisers sell mutual funds, the Securities and Exchange Commission has released a new report examining public and industry perspectives on investment advisors and broker/dealers.

Two lawsuits and two FINRA arbitration claims filed against the executives, directors, chief compliance officer, portfolio managers and independent auditor of three open-end funds and four closed-end funds managed by an affiliate of Memphis, Tenn., broker/dealer Morgan Keegan & Co., may be the tip of the subprime iceberg for the mutual fund industry.

Seeing how the biggest story of 2007 was the subprime crisis, which only a few canny hedge fund managers foresaw, let's take a look ahead to potential news headlines for 2008. Who knows, we might even be as canny as the best of them.