Vanguard has admitted it provided investors in several money market funds inaccurate information about the estimated income they could expect to earn.
The error on client statements continued for almost a year, according to Dan Wiener, editor of The Independent Adviser for Vanguard Investors, who first reported the problem.
In response, Vanguard issued a statement that it “recently corrected an issue on certain client statements where money market funds were displaying inaccurate estimated yields and annual income” and notified clients of the correction on their monthly statements. It noted “there was no impact to clients’ fund holdings, distributions, or account balances.”
The error occurred on statements for as many as nine money market funds, including federal government, Treasury and some muni money market funds. Vanguard is liquidating two of the funds this month: the Pennsylvania Municipal Money Market Fund and the Vanguard New Jersey Municipal Money Market Fund. Notification of the error is included in the footnote of clients’ October statements, according to Wiener.
(Related: Vanguard to Liquidate 2 Money Market Funds)
He attributed the error to a computer glitch, which is nothing new for Vanguard nor for many other asset managers. In Monday’s frenetic rally on Wall Street, customers of Vanguard, Fidelity, Merrill Lynch, Charles Schwab and TD Ameritrade reported issues logging into their accounts.