The San Mateo, California company will add 2% redemption fees on short-term trades on 112 U.S.-based open-ended funds, and other funds will charge a 1% fee, according to the Oakland Tribune.
The changes are effective June 1. Massachusetts regulators have accused Franklin of allowing a Las Vegas broker to make frequent trades in a mutual fund, conflicting with policies set out in the fund’s prospectus (See Report: Franklin’s Trading Problems Worse than First Thought ) . Federal and state regulators have been pursuing a wide-ranging fund industry probe since last fall focusing on late trading, market timing and certain sales practices.
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