NU Online News Service, August 9, 2004, 3:00 p.m. EST
Conseco Inc. and Inviva Inc. agreed to pay $20 million to settle regulators’ charges that they helped market timers make big profits at the expense of individual investors.[@@]
Neither company admitted any guilt in the charges, which were brought by the Securities and Exchange Commission, Washington.
Under the settlements, units of Conseco agreed to pay $15 million, including disgorgement of $7.5 million and civil penalties of $7.5 million. Inviva and a subsidiary will pay $5 million, including disgorgement of $3.5 million and a civil penalty of $1.5 million. These amounts will be distributed to shareholders of mutual funds affected by the market timing, the SEC said.
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The charges against Conseco, Carmel, Ind. and Inviva, New York, were the first the SEC brought against insurance companies in the market timing scandal. It charged both companies with securities fraud for helping market timers trade in mutual funds through the sale of variable annuities.
The charges involved Conseco subsidiaries CIHC Inc., Conseco Services LLC and Conseco Equity Sales Inc. as well as Inviva and its subsidiary, Jefferson National Life Insurance Company.