MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
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Monday, June 4, 2007 Ex-Putnam Portfolio Managers Settle with the SEC Justin Scott and Omid Kamshad, former managing directors and portfolio managers at Putnam Investments, have settled a complaint brought by the SEC alleging that they engaged in inappropriate trading of Putnam mutual fund shares. The final judgment orders Scott to pay disgorgement of ill-gotten gain in the amount of $489,439 plus prejudgment interest of $159,475, and a civil penalty of $400,000. The judgment provides that half of his total liability may be offset by payments he made to settle a related action by the Secretary of State of the Commonwealth of Massachusetts. Kamshad will pay disgorgement of $57,157 plus prejudgment interest of $13,709, and a civil penalty of $400,000. Scott and Kamshad also agreed to be suspended from association with any investment adviser for a year. The two neither admitted nor denied the allegations. The Commission announced today that a final judgment by consent was entered by the United States District Court of the District of Massachusetts against Justin Scott and Omid Kamshad, two former Managing Directors and portfolio managers at Putnam Investments. The final judgments against Scott, age 49 of Marblehead, Massachusetts, and Kamshad, age 44, of London, England, permanently enjoin them from violating antifraud provisions of the Investment Advisers Act, require them to disgorge their ill-gotten gain, plus prejudgment interest, and order them each to pay a $400,000 civil penalty. Scott and Kamshad have also consented to entry of an Order suspending them from association with an investment adviser for one year. The Commission's Complaint, filed October 28, 2003, alleged that Scott and Kamshad engaged in inappropriate trading of Putnam mutual funds shares, including in mutual funds over which they had investment authority. The Commission charged that Scott and Kamshad's short-term trades, which were made in their Putnam-administered deferred compensation and retirement accounts, violated their responsibilities to other fund shareholders, that Scott and Kamshad failed to disclose their trading and that, by their trading, they potentially harmed other fund shareholders. To settle the Commission's charges, Scott consented, without admitting or denying the allegations of the Complaint, to the entry of a final judgment permanently enjoining him from violation of Sections 206(1) and (2) of the Advisers Act. The judgment orders Scott to pay disgorgement of ill-gotten gain in the amount of $489,439, plus prejudgment interest in the amount of $159,475. The judgment also orders Scott to pay a civil penalty in the amount of $400,000. The judgment provides that half of Scott's total liability of $1,048,914 may be offset by payments made by Scott to settle a related action brought by the Secretary of State of the Commonwealth of Massachusetts. In addition, Scott also consented to the issuance of an SEC order, based on the entry of the injunction in the federal court action, which suspends him from association with any investment adviser for one year. To settle the Commission's charges, Kamshad similarly consented, without admitting or denying the allegations of the Complaint, to the entry of a final judgment permanently enjoining him from violation of Sections 206(1) and (2) of the Advisers Act. The judgment orders Kamshad to pay disgorgement of ill-gotten gain in the amount of $57,157, plus prejudgment interest in the amount of $13,709. The judgment also orders Kamshad to pay a civil penalty in the amount of $400,000. The judgment provides that half of Kamshad's total liability of $470,866 may be offset by payments made by Kamshad to settle a related action brought by the Secretary of State of the Commonwealth of Massachusetts. In addition, Kamshad also consented to the issuance of an SEC order, based on the entry of the injunction in the federal court action, which suspends him from association with any investment adviser for one year. The Commission acknowledges the assistance of the Secretary of State of the Commonwealth of Massachusetts in this matter. Printed from: MFWire.com/story.asp?s=14607 Copyright 2007, InvestmentWires, Inc. All Rights Reserved |