Jan. 8, 2004 — Mutual fund company J&W Seligman & Co. Inc. said it had a market timing arrangement last year and three previous arrangements.
Seligman also said an internal review found no instances of of improper trading in its funds by its employees or late trading by the funds’ shareholders.
The company said it has responded to a request for information from the Securities and Exchange Commission related the the agency’s review of market timing and and late trading.
Seligman said one employee, who it did not identify, has left the company in connection with its in-house review.
The company said in a regulatory filing today that it had a market timing arrangement in September 2003 that it was in the process of closing down before the first proceedings related to trading practices in the mutual fund industry were publicly disclosed that month.
Seligman said its review of its records for the past three years uncovered three other timing arrangements that were terminated before the end of September 2002.
The company said it is “confident” that any financial impact of the arrangements on its funds was “minimal.” Seligman said it will make restitution to any fund that was harmed because of any illegal actions or violations of internal policies by the company or its employees.
Seligman said its compensation agreements with some brokerage houses that sell its funds and that execute buy and sell orders for them may have violated some rules. But Seligman said it is confident that its funds did not pay higher brokerage commissions in connection with the orders than it would otherwise have paid for comparable transactions.
Seligman said that last October it stopped placing buy and sell orders for its funds with brokerages that sell them in recognition of their fund sales.