BOSTON – Fidelity Investments, the biggest U.S. mutual fund company, and John Hancock Funds received subpoenas from Massachusetts and New Hampshire regulators as part of an industry-wide probe of improper trading.
Fidelity was asked for information about the trading records of international stock fund managers, spokeswoman Anne Crowley said. It was a request for details and not a statement of wrongdoing, she said. John Hancock Funds said in a statement that it received a similar subpoena.
New York Attorney General Eliot Spitzer, who initiated the investigation of the $7 trillion fund industry, is pursuing complaints against companies including Alliance Capital Management Holding LP and Strong Capital Management Inc. for alleged short-term trading that siphoned profits from long-term investors. In the past two months, more than 40 people have been suspended or fired because of the probe.
Fidelity, Capital Group Cos.’ American Funds and Franklin Resources Inc. are being investigated by the SEC for payments made to Morgan Stanley to promote sales of their products. Morgan Stanley agreed recently to pay $50 million to settle SEC charges that it was selling funds from as many as 16 companies in return for payments that weren’t disclosed to investors. (Bloomberg News)
Talbots third quarter net falls 7 percent on slow sales
HINGHAM – Talbots Inc., a clothes retailer, said third-quarter profit declined 7 percent as shoppers bought less merchandise at full price.
Net income fell to $34.8 million, or 60 cents a share, from $37.4 million, or 63 cents, a year earlier. Sales in the period ended Nov. 1 increased 1.6 percent to $408.2 million from $401.8 million, the company said in a statement distributed by Business Wire.
Sales at stores open at least a year dropped 4.5 percent as shoppers bought less clothing discounted for clearance in October. The retailer also sold less merchandise at full price as fewer customers than expected visited stores.
Talbots said it won’t provide a forecast for fourth-quarter sales and profit until later in the period, when sales trends become clearer. The company was expected to earn 59 cents in the third quarter and 47 cents in the fourth quarter, according to the average estimates of analysts surveyed by Thomson Financial. (Bloomberg News)
