The Boston-based fund company agreed to pay $10 million in disgorgement and a $100 million penalty in agreements with the US Securities and Exchange Commission (SEC) andMassachusetts Secretary of State William Galvin.
“This case uncovered a corporate culture that turned a resolute blind eye to the most egregious conduct on the part of its managers who indulged in market timing, as well as the favored fund participants who were allowed to market time at the expense of other shareholders,” said Galvin, the Bay state’s top securities regulator in a statement .
Half of the money is intended to settle the SEC charges and half those levied by Galvin. The $10 million in ill-gotten profits will be distributed to shareholders according to a plan approved by an independent consultant.
“These settlement agreements with the SEC and Secretary Galvin’s Office reflect our commitment to put these matters behind us and continue to move forward as a firm focusing on rebuilding investor confidence and delivering consistent, dependable, superior investment performance over time,” said Ed Haldeman, President and Chief Executive Officer of Putnam in a statement.
“The Trustees of the Putnam Funds are pleased that Putnam Investments has reached a final settlement with the SEC and Massachusetts with respect to all allegations regardingimproper trading in the Putnam Funds,” said John Hill, the independent chairman of the Putnam Funds. “These matters have now been thoroughly investigated for over six months by both agencies as well as by our own board’s audit committee,which issued its report and recommendations several weeks ago. We are confident that strong procedures are now in place at Putnam to prevent any recurrence of similar problems in the future.”
For more information, go to www.putnaminvestments.com .
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