U.S. Securities & Exchange Commission
SEC Seal
Home | Previous Page
U.S. Securities and Exchange Commission

Banc of America Capital Management, LLC, BACAP Distributors, LLC, and Banc of America Securities, LLC

Latest Action: To date, the SEC has made 11 tranches of distributions and 4 coordinated distributions to investors harmed by mutual fund market timing activities in BOA's Nations Funds and Unaffiliated Funds. From the $375 million Fair Fund amount, the SEC has distributed approximately $342 million to more than 1.5 million affected fund shareholders and 525 affected funds. Investors can obtain additional information about the distribution process by calling Rust Consulting, Inc., the Fair Fund Administrator, at (866) 730-8148, and by visiting http://www.bankofamericafairfund.com.

Background: On February 9, 2005, the SEC instituted administrative and cease-and-desist proceedings against Banc of America Capital Management, LLC, BACAP Distributors, LLC and Banc of America Securities, LLC. The SEC alleged that the respondents improperly entered into agreements with favored large investors enabling them to conduct short-term trading (known as “market timing”) and failed to disclose these arrangements with other investors. The SEC also alleged that Banc of America Securities, LLC fraudulently facilitated late trading in its mutual fund complex as well as in unaffiliated mutual funds.

As part of the settlement, the respondents must pay $375 million, consisting of $250 million in disgorgement of ill-gotten gains and $125 million in civil penalties for distribution to the mutual funds and shareholders harmed as a result of market timing and late trading. For more information on the SEC's action, you can read In the Matter of Banc of America Capital Management, LLC, BACAP Distributors, LLC, and Banc of America Securities, LLC, 33-8538 (Feb. 9, 2005).

Under the terms of the SEC's Order, an Independent Distribution Consultant must submit to the SEC a distribution plan for the distribution of the Fair Fund containing $375 million to investors. On July 16, 2007, the SEC published Notice of Proposed Distribution Plan and Opportunity for Comment, which specifies how copies of the proposed Distribution Plan can be obtained, and describes the process by which persons may comment on the Plan. Those who wish to provide their comments on the proposed Distribution Plan must submit them, in writing, no later than August 13, 2007.

After publication and comment, the proposed Distribution Plan will be submitted to the SEC for approval. On December 27, 2007, the SEC approved the distribution plan.


Modified: 09/13/2012