Eight former mutual fund directors have settled federal claims that they allowed others at the firm to set values for subprime mortgage securities that were held by funds on which investors lost about $1.5 billion.
The Securities and Exchange Commission announced the settlement with the former directors of the Regions Morgan Keegan funds. They aren't paying any penalty under the settlement. The SEC brought an enforcement action against the directors in December, saying they delegated the duty to fund managers, even though directors are required by law to set values when market prices aren't available.
The SEC alleged the directors failed to make a diligent effort to learn how the values were determined.
They neither admitted nor denied wrongdoing but agreed to refrain from future violations of the securities laws.
(Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)