Sept. 13, 2004 — Three units of Pimco Funds agreed to pay $50 million to settle charges by the Securities and Exchange Commission that they defrauded investors by permitting rapid trading in mutual fund shares.
Under the settlement, the units will pay $40 million in penalties and will disgorge $10 million. The affiliates — PA Fund Management LLC, PEA Capital LLC and PA Distributors LLC, all units of German insurer Allianz AZ — neither admitted or denied wrongdoing.
The three units also agreed to impose redemption charges and take other steps to guard against rapid trading and to take steps to strengthen its compliance systems and governance.