SEC Charges Prudential Subsidiaries For Misleading Funds They Advised, Generating Tens of Millions in Tax Benefits for Prudential
The Securities and Exchange Commission today charged two subsidiaries of Prudential Financial Inc. with failing to disclose conflicts of interest and making…
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The Securities and Exchange Commission today charged two subsidiaries of Prudential Financial Inc. with failing to disclose conflicts of interest and making misleading disclosures to the boards for 94 funds they advised. According to the SEC's order, Prudential subsidiaries AST Investment Services Inc. and PGIM Investments LLC (PI) served as investment advisers to 94 insurance-dedicated mutual funds. The order finds that in 2006, the funds were reorganized so that Prudential could receive certain tax benefits. Those benefits to Prudential, however, came with negative consequences to the funds. First, AST and PI cost the funds tens of millions of dollars in interest income when they temporarily recalled securities the funds had out on loan.
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