Mutual Fund Trading Abuses: Lessons Can Be Learned from Sec Not Having Detected Violations at an Earlier Stage

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DIANE Publishing, 2005 - 51 pages
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Contents

I
1
II
4
III
7
IV
10
V
21
VI
33
VII
35
VIII
36
IX
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X
40
XI
43
XII
45

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Page 3 - Act and which is excluded from the definition of investment company under the Investment Company Act of 1940. Hedge funds are also characterized by their fee structure, which compensates the adviser based upon a percentage of the hedge fund's capital gains and capital appreciation. Pursuant to a new rule recently adopted by SEC, advisers of certain hedge funds are required to register with SEC under the Investment Advisers Act of 1940. See Registration Under the Advisers Act of Certain Hedge Fund...
Page 40 - This report is the result of our unprecedented study of the effectiveness of State and national bank supervision by the Federal Deposit Insurance Corporation; the Federal Reserve System; and the Office of the Comptroller of the Currency, Department of the Treasury. This study was made at the request of several congressional committees concerned over large bank failures in recent years and public disclosure that supervisory agencies' lists of "problem banks
Page 3 - ... contain copyrighted images or other material, permission from the copyright holder may be necessary if you wish to reproduce this material separately.
Page 3 - Market timing typically involves the frequent buying and selling of mutual fund shares by sophisticated investors, such as hedge funds, that seek opportunities to make profits on the differences in prices between overseas markets and...
Page 31 - USC 80b-6) for you to provide investment advice to clients unless you: (a) Policies and procedures. Adopt and implement written policies and procedures reasonably designed to prevent violation, by you and your supervised persons, of the Act and the rules that the Commission has adopted under the Act; (b) Annual review. Review, no less frequently than annually, the adequacy of the policies and procedures...
Page 31 - Requires open-ended management investment companies to disclose in their prospectuses both the risks to shareholders of frequent purchases and redemptions of investment company shares, and the investment company's policies and procedures with respect to such frequent purchases and redemptions.
Page 43 - Mutual funds employ transfer agents to conduct recordkeeping and related functions. Transfer agents maintain records of shareholder accounts, calculate and disburse dividends, and prepare and mail shareholder account statements, federal income tax information, and other shareholder notices. NSCC is currently the only clearing agency registered with SEC that operates an automated system, called Fund/SERV, for processing orders for mutual funds and other securities. Fund/SERV provides a central processing...
Page 4 - The banking agencies, the Securities and Exchange Commission (SEC), and the National Association of Securities Dealers (NASD) have agreed that the banking agencies and NASD will coordinate the examination of bank brokerage units.
Page 31 - Requires a registered management investment company to provide disclosure in its reports to shareholders regarding the material factors and the conclusions with respect to those factors that formed the basis for the board's approval of advisory contracts during the most recent fiscal half-year.
Page 28 - The entities named in this column are investment advisers associated with these cases. In some cases, SEC simultaneously charged other entities, such as an associated investment adviser, distributor, or broker-dealer for their role in the market timing abuses. The penalties and disgorgements shown for each case are the totals obtained in settlement from all the entities associated with the case. b Bank of America settled charges involving both abusive market timing and late trading on the part of...

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