By Sam Mamudi

NEW YORK (Dow Jones) -- With investor confidence badly shaken in recent months, the last thing mutual funds need is to be accused of a lack of transparency. But three funds have come in for criticism for just this reason.

Funds from RiverSource Investments, a unit of Ameriprise Financial Inc. (AMP), American Century Investments and OppenheimerFunds have failed to explain recent changes to their shareholders, according to one industry analyst.

In one instance the change was a one-time charge that's rarely passed on to investors, according to Andrew Gogerty, analyst at investment researcher Morningstar Inc.

"It's about stewardship of a fund, but it's also about communication to shareholders," Gogerty said. "None of [the moves] were explained."

In a research note published on Thursday, Gogerty accused the funds of falling short in their stewardship, and said their behavior was "disrespectful to the shareholders they're serving."

Gogerty was upset at RiverSource for charging shareholders for the cost of switching transfer agents after it bought J. & W. Seligman's funds, at American Century for changing fund managers without explanation, and at Oppenheimer for not telling investors that two bond funds were taking on extra risk.

Thrown a curve

The analyst said there's "really no excuse" for RiverSource passing the cost of the transfer agent switch to its investors. Under the plan, some Seligman shareholders will receive a one-time charge of 0.16% of assets.

"I can't tell you the last time a shareholder got stuck with a charge like this," he said. Fund managers often incur one-time changes when they take over other funds, but they usually absorb those costs themselves.

RiverSource spokesman Ryan Lund said the situation was unique because the Seligman funds ran their own transfer agent.

"This one-time charge is a result of the cost associated with the funds exiting the transfer agent business," said Lund. "Exiting the transfer agent business will result in significant annual savings for the Seligman mutual funds going forward."

But Gogerty said that even if the move will offer long-term savings, such a decision, made by the firm, shouldn't penalize investors.

Gogerty was upset with American Century because when the firm announced new managers for its International Bond Fund (BEGBX), it didn't say why it decided to dismiss the old managers.

Under the stewardship of J.P. Morgan Asset Management, the fund was in the top 25% of its peers for three- and five-year returns through December, and had a four-star Morningstar rating. Those managers were replaced last month by two new hires.

"If you're a shareholder in a great four-star fund, you don't expect a management change," Gogerty said. He said the fact that American Century didn't explain why the managers needed to be replaced was unacceptable.

David MacEwen, fixed income chief investment officer at American Century, said that the firm didn't think it was appropriate to explain why the J.P. Morgan managers were let go in a press release. "I don't think that's the normal thing to do," he said.

MacEwen said American Century held one major conference call and about 15 to 20 separate calls with investors to explain the change. While the fund had done well compared to its peers, it had underperformed its custom-designed benchmark since inception, he said.

"We can do better and I know the [new] team can do better," MacEwen said. He added that the change was also part of a broader move by American Century to bring fund management in-house. "We as a firm want to control risk," he said.

American Century is in the process of cancelling three other sub-adviser relationships, said MacEwen, who added that it may be left with just one sub-advised fund in its lineup once the changes are completed.

Broken bonds

Oppenheimer saw two of its bond funds, Champion Income (OPCHX) and Core Bond (OPIGX), suffer large losses in 2008 -- 78% and 36%, respectively.

"Core Bond is an intermediate-term bond fund," he said. "You don't expect a fund like that to lose so much value."

Gogerty said the fund's losses weren't just because of bad securities, but because of the extra risk that may not have been apparent to shareholders.

"Specifically, the managers bought complex, off-balance-sheet swap contracts that created a leveraging effect on the funds," he said. No attempt was made to communicate to shareholders that these funds were taking on additional risk, Gogerty said.

Oppenheimer spokesman Bruce Dunbar said that all the securities bought by the funds were "completely appropriate to their portfolios and fit the funds' risk characteristics."

He said the swap contracts and similar securities that the funds bought were widely used by other funds in the same categories. "Our investment process is based on looking at historical data for the securities."

Decisions were made "based on the way those securities had behaved," he said, adding that before last year, the funds enjoyed an "outstanding" four-year track record.