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$21M Fund Fraud Settlement Is 1st In SEC Campaign

Law360 (September 27, 2006, 12:00 AM EDT) -- A mutual-fund administrator has agreed to pay the U.S. Securities and Exchange Commission $21.7 million for its role in a fraudulent scheme involving over two dozen fund advisers, the SEC said Tuesday.

BISYS Fund Services Inc. entered into undisclosed side agreements with the advisers, which enabled them to improperly use investors' mutual fund assets to pay for marketing expenses rather than pay for those expenses out of their own assets, the SEC charged in its complaint.

As many as 27 mutual fund families were involved in...
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