Quantcast

Spitzer says Seligman execs OK’d abusive trading

September 29, 2005

NEW YORK (Reuters) – Executives at J&W Seligman & Co.,
including the money management firm’s president, approved at
least a dozen secret deals allowing abusive trading in its
mutual funds, New York Attorney General Eliot Spitzer said on
Thursday.

In a court filing on Wednesday, Spitzer cited previously
undisclosed evidence of market timing at Seligman and asked a
state court to order the company to provide additional
information relating to abusive trading practices at the firm.

“While the company has acknowledged allowing some improper
market timing, the full extent of the problem at Seligman has
not been disclosed to investors,” Spitzer said in a statement.

“Our action is designed to ensure that Seligman is held
accountable for actions that clearly harmed shareholders,” he
said.

The attorney general’s office said in a statement on
Thursday that the secret deals were approved by Seligman’s
senior management, including on at least one occasion the
firm’s current president.

The arrangements violated limitations set forth in the
company’s prospectuses, the office said.

Seligman’s mutual funds may have suffered up to $80 million
in damages from market timing transactions that were sanctioned
or tolerated by senior management, the office said.

Seligman previously announced a settlement with its funds
to compensate investors. In May, it said it paid almost $2
million to three of its mutual funds.




comments powered by Disqus