Spitzer, SEC charge Invesco
NEW YORK (Reuters) -- The New York Attorney General's office and the Securities and Exchange Commission Tuesday charged Invesco Funds Group and its chief executive with allowing numerous hedge funds to make improper trades in its mutual funds.
Both the SEC and New York Attorney General Eliot Spitzer's office filed civil charges alleging that Denver-based Invesco's top management allowed privileged investors to profit from a rapid trading strategy denied to ordinary investors.
The two authorities also filed civil charges against Invesco Chief Executive Raymond Cunningham.
Spitzer's office called the conduct a "massive'' scheme. Special agreements that allowed certain investors to engage in the practice "were kept secret from the independent members of the funds' boards and from the funds' investors,'' the SEC said.
"The evidence in this case speaks for itself,'' Spitzer said in a release. "Top managers knew market timing was harming buy-and-hold investors but they condoned and facilitated it because it was a lucrative source of management fee revenues.''
On Monday a spokesman for Invesco's parent, U.K.-based asset management company Amvescap Plc, said that the company would "vigorously'' fight any charges filed against it.
Copyright 2003
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
