Hedge Fund Financier Pays $16.8M To Settle With SEC

Law360 (May 7, 2007, 12:00 AM EDT) -- Zurich Capital Markets Inc. will pay the U.S. Securities and Exchange Commission $16.8 million to settle allegations that it funded hedge fund clients that engaged in deceptive market timing of mutual funds.

In an administrative order filed before the Commission Monday, the SEC alleged that ZCM helped four hedge fund clients defraud mutual funds that prohibited market timing. Both ZCM and the hedge funds knew they were taking part in illegal activity, the order said.

“In order to buy, exchange and redeem shares in these mutual...
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