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Spitzer, SEC Charge Invesco with Securities Fraud

Invesco says it will contest the charges vigorously.

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Invesco on Tuesday became the third fund company formally charged with harming long-term investors by allowing market-timing in its mutual funds.

New York state Attorney General Eliot Spitzer and the Securities and Exchange Commission filed civil securities fraud charges against Invesco and its president and chief executive Raymond R. Cunningham for "engaging in a massive mutual fund timing scheme." In a statement, Invesco denied it or Cunningham did anything improper and vowed to contest the charges. Nevertheless, Invesco joins Putnam and Pilgrim Baxter on the list of fund firms facing formal market-timing charges. A number of other firms, including  Alliance Capital Management (AC), Strong Capital Management, and  Bank One (ONE) have admitted or been accused of improper trading and could face charges.

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Dan Culloton does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.