Alliance Capital Management Holdings LP, under investigation for possible trade abuses, is close to a pact with federal regulators to pay a $250 million fine, the largest ever levied against a mutual fund company, the Wall Street Journal reported on Monday.
Alliance is also nearing an agreement with New York Attorney General Eliot Spitzer that would reduce fees for fund investors, the newspaper said. Spitzer and the SEC had disagreed about settlement terms for cutting investor fees.
A final agreement, which could be announced early this week, would also include a structural reorganization in the way the funds are run, the Journal said, citing people familiar with the talks.
Alliance representatives could not immediately be reached for comment.
The New York-based company is one of several large fund groups being probed by Spitzer, the SEC and other regulators for possible improper market timing, or rapid buying and selling of fund shares in violation of stated fund policies.