Charles Schwab Corp.
received bad news yesterday, when a U.S. district judge in San Francisco issued a ruling in the case involving Schwab's YieldPlus
U.S. District Judge William Alsup ruled that Schwab breached the law when it did not obtain the go-ahead from shareholders before putting more than a quarter of YieldPlus fund assets into mortgage-backed securities,
Schwab's portfolio managers "reversed field and repudiated" the fund's policy of restricting investments in a single industry to 25 percent, according to Alsup.
"While we disagree with the judge's ruling on this issue, he has only
ruled on one of several claims and there are many more issues to be
decided," wrote Schwab spokesperson David Weiskopf in e-mailed comments
to The MFWire
. "We look forward to putting all the facts, evidence and expert
testimony to the jury and presenting a strong case at trial. "
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