Manulife Financial, a Toronto-based insurer, revealed in a regulatory filing that it has received a subpoena from New York State Attorney General Eliot Spitzer as part of his probe into mutual fund trading abuses in the US, the Toronto Globe and Mail reported. Manulife said it has also been hit with a handful of other information demands from both US and Canadian regulators including the US Securities and Exchange Commission (SEC), the National Association of Securities Dealers (NASD) and the Ontario Securities Commission.
Not only that, but John Hancock, the Boston insurance company Manulife recently agreed to acquire in a $15-billion deal (See Report: John Hancock Could Soon be Seller or Buyer ), said in the filing that it has gotten information demands from both the SEC and the NASD as well as a subpoena from the Secretary of State of Massachusetts, one of a number of states taking part in the mutual fund inquiry.
Manulife is the second Canadian company to become entangled in the probe. Massachusetts Financial Services Co., the mutual fund unit of Sun Life Financial Inc. has acknowledged it is being investigated by the SEC and Spitzer, and is currently in settlement talks with both parties, according to sources.
Regulators have accused MFS of providing “false and misleading” disclosure to investors in prospectuses for 11 of the companies largest funds (See MFS Misses Market Timing in 11 Funds ), and SEC investigators have informed the company they intend to pursue an enforcement action, according to the newspaper.