Calugar Agrees to Record Settlement to Market-Timing Charge

January 10, 2006 ( - Las Vegas broker Daniel Calugar has agreed to pay $153 million to settle charges that he traded mutual funds improperly.

Reuters reports that the settlement is the biggest penalty imposed against an individual resulting from regulators’ probes into the mutual fund industry.   Calugar will give up $103 million in profits and pay a $50 million civil fine, according to the proposed settlement.

He neither admitted to nor denied any wrongdoing, according to Reuters.

In December 2003, the Securities and Exchange commission (SEC) accused Calugar of making illegal and improper trades in funds run by Alliance Capital Management Holdings LP and Massachusetts Financial Services Inc., a unit of Canada’s Sun Life Financial Inc. (See  SEC: Las Vegas Investor Made $175M in Ill-Gotten Gains).   Calugar has already paid $72 million of the $175 million he was accused of taking.

Franklin Resources was also accused of making a market-timing deal with Calugar’s firm Security Brokerage Inc. (See Massachusetts Hits Franklin with Fraud Charges).