Seligman Funds: Proceed with Caution
The firm has changed enough that a repetition of past problems is unlikley.
Regulators have accused J. & W. Seligman & Co., advisor to the Seligman funds, of approving market-timing arrangements with various entities that violated the funds' prospectuses and were harmful to fund shareowners. While we believe the charges are quite serious, we also think that Seligman has reformed itself enough that investors interested in investing in the firm's funds can do so at their discretion, although we believe they should proceed with caution.
In early 2004, Seligman disclosed that an internal review in late 2003 had found four market-timing agreements in the preceding three years. Later that year, the shop disclosed that the board had directed it to reimburse four funds a total of $2 million dollars to make up for any harm done to shareholders; simultaneously the shop announced that the SEC, NASD, and New York Attorney General Eliot Spitzer were investigating.