 Putnam investments has acknowledged its mistakes accepting the $110m fine |
Putnam Investments has agreed to pay fines totalling $110m to settle charges that it engaged in "market timing" of mutual funds. Market timing, which exploits short-term movements in share prices, is frowned upon because it skims profits from long-term shareholders.
In a settlement with Massachusetts state, Putnam admitted it had tolerated market timing by some of its managers.
The mutual-funds industry is worth around $7.6 trillion.
Several other firms have already been fined as part of a federal and state probe into the industry.
Acknowledgement of mistakes
Putnam, the sixth biggest US mutual fund, had agreed to make "significant and far-reaching reforms" to resolve a trading scandal.
About 95 million people in the United States invest in mutual funds.
New York Attorney General Eliot Spitzer began investigating the mutual funds industry in the summer of 2003, partly in tandem with Massachusetts regulators.
The Securities and Exchange Commission (SEC) financial watchdog is determined that Putnam would make up losses suffered by investors.
Massachusetts' top securities regulator, Secretary of the Commonwealth, William Galvin said: "What was always troubling at Putnam was that the wrongdoing reached the fund managers and went on for so long with so many people in the corporation who knew about it and tolerated it".
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The real breakthrough is the acknowledgement of wrongdoing 
