Alliance Agrees to Cut Fees, Repay Fund Shareholders
Firm makes big concessions to get market-timing scandal behind it.
Alliance Capital Management took an important step toward putting the mutual fund trading scandal behind it Thursday by agreeing to reduce its expense ratios by 20% and to pay $250 million to settle state and federal charges that the firm defrauded investors by allowing market-timing in its funds.
Alliance agreed to reduce the expense ratios of its AllianceBernstein funds by 20% starting Jan. 1, 2004, and not change them for at least five years to settle New York Attorney General Eliot Spitzer's charges that the firm let large clients and hedge funds market-time its mutual funds in return for "sticky assets" in other Alliance accounts.
Dan Culloton does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.