Prudential Pays $32.6 Million to Settle Probe of Mutual-Fund Business
17 September 2019 - 6:43AM
Dow Jones News
By Dave Michaels
WASHINGTON -- Prudential Financial Inc. agreed to pay $32.6
million to settle claims that it didn't disclose how a
reorganization of its mutual-fund business would cost the funds
millions in lost interest income.
The Securities and Exchange Commission on Monday said the 2006
reorganization -- intended to engineer tax benefits for Prudential
-- created a conflict of interest because the company benefited
while the funds lost income from securities lending. They also paid
higher taxes in certain foreign jurisdictions. In addition to
paying the fines, Prudential reimbursed over $155 million to the
funds, the SEC said in a settlement announcement.
Prudential neither admitted nor denied the claims. A company
spokesman didn't immediately respond to a request for comment.
"Investment advisers must be vigilant in monitoring for
conflicts related to actions taken by affiliates, and must act
consistently with their representations to their clients," said
Dabney O'Riordan, co-chief of the SEC's asset-management unit in
its enforcement division. Prudential's subsidiaries "acted to
benefit their parent company despite the costs those acts imposed
on their clients."
Write to Dave Michaels at dave.michaels@wsj.com
(END) Dow Jones Newswires
September 16, 2019 16:28 ET (20:28 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Prudential Financial (NYSE:PRU)
Historical Stock Chart
From Mar 2024 to Apr 2024
Prudential Financial (NYSE:PRU)
Historical Stock Chart
From Apr 2023 to Apr 2024
