The already embattled Janus Capital Group Inc. has announced that it has found evidence that several short trading arrangements existed in the company's offshore mutual-fund business, similar to those that existed in the U.S. the Wall Street Journal reports.
However, it seems as if the company has learned its lesson since the Canary Capital Partners affair broke: the company said all the deals have been terminated.
The company also said that it is cooperating with a NASD request to provide information about agreements to distribute mutual-fund company shares through broker dealers.
Janus added that because many mutual-fund transactions are cleared and settled through financial intermediaries and because some of the individuals involved trading relationships in question are no longer employees of Janus, the company couldn’t exclude the possibility that one or more of those intermediaries submitted improper or unauthorized late trades.
Janus has said it already believes there were 12 frequent trading arrangements across its U.S. mutual-fund business and that significant discretionary frequent trading appears to have occurred with respect to four of those arrangements. Those arrangements were all terminated by the end of September sparking outflows of $314 million.
In the meantime, the company said it is working with its foreign legal counsel and offshore distributors to develop guidelines for existing and future business practices.
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