Three investors have sued the Janus mutual funds company in federal court, accusing it of illegal trading practices that harmed shareholders.<\/p>\n
One suit alleges favored customers of the Denver-based company were allowed to “time” their mutual fund trades. The suit, filed Tuesday by Ronald Abrams of West Bloomfield, Mich., and Robert Waring of Great Neck, N.Y., seeks class-action status to include other investors who purchased Janus stock between October 1998 and July 2003, when the alleged misconduct took place.<\/p>\n
A similar suit was filed Friday by Vivian Bernstein of New Rochelle, N.Y.<\/p>\n
Janus spokeswoman Shelley Peterson declined to comment on the lawsuits.<\/p>\n
Also named in the suit by Abrams and Waring is Canary Investment Management, a New Jersey-based hedge fund that agreed to pay back $30 million in profits from unlawful trading in addition to a $10 million penalty in a settlement with New York authorities this month over allegations of allowing trading at preclosing prices after markets closed. Ordinary traders who place late orders must pay the following day’s prices.<\/p>\n
New York Attorney General Eliot Spitzer had accused Canary of obtaining special trading opportunities with leading mutual fund families – including Janus, Bank of America’s Nations Funds, Bank One and Strong – by promising to make substantial investments.<\/p>\n
Janus was not accused of engaging in late-day trading, Peterson said.<\/p>\n
“Market timing in and of itself is not illegal,” she said.<\/p>\n
The Denver lawsuits, filed less than two weeks after the New York settlement, make similar allegations and seek monetary damages.<\/p>\n
Janus chief executive officer Mark Whiston has said the company is taking steps to address market-timing issues.<\/p>\n
Such steps include hiring an outside firm to evaluate any monetary impact to funds in which Janus permitted discretionary market-timing arrangements and providing restitution to affected shareholders.<\/p>\n
Janus said investments by market timers represented less than 0.5 percent of its $150 billion in assets as of the end of July.<\/p>\n
—<\/p>\n
On the Net: http:\/\/www.janus.com<\/p>\n","protected":false},"excerpt":{"rendered":"
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