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U.S. Securities and Exchange Commission

SEC Announces $30 Million Fair Fund Distribution to Investors Affected by Undisclosed Market Timing in RS Investments Mutual Funds


Washington, D.C., April 25, 2008 - The Securities and Exchange Commission today announced the distribution of approximately $30.6 million to more than 250,000 investors who were affected by undisclosed market timing in certain RS Investments mutual funds.

The Fair Fund distribution includes $25 million in disgorgement and penalties paid by RS Investment Management, Inc. and RS Investment Management, L.P. (RS Investments) in an SEC enforcement action, approximately $3.3 million in disgorgement and penalties from Banc of America Capital Management LLC, BACAP Distributors LLC, and Banc of America Securities LLC related to a separate unlawful market timing matter that affected RS Investments investors, and accumulated interest.

"This distribution demonstrates the SEC's continued commitment to returning funds to investors affected by market timing misconduct," said Linda Chatman Thomsen, Director of the SEC's Division of Enforcement.

The Sarbanes-Oxley Act of 2002 gave the SEC authority to increase the amount of money returned to injured investors by allowing civil penalties to be included in Fair Fund distributions. Prior to SOX, only disgorgement could be returned to investors. Since 2002, SEC enforcement actions have resulted in more than $3.7 billion in distributions to investors.

In 2004, the SEC brought settled administrative and cease-and-desist proceedings against RS Investments, G. Randall Hecht, and Steven M. Cohen, who consented to a Commission Order without admitting or denying the SEC's findings. The SEC charged that RS Investments improperly allowed market timing in certain mutual funds from at least 2000 to mid-2003. In addition to disgorgement and civil penalties, RS Investments also consented to a cease-and-desist order and a censure, and agreed to undertake certain compliance and mutual fund governance reforms.

The Fair Fund Administrator responsible for distribution is Boston Financial Data Services, Inc. (BFDS). Investor questions regarding the distribution may be directed to BFDS at (866) 700-0119. Information regarding the distribution can also be obtained at http://rssettlement.com/start.asp.

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Additional materials:

Distribution Plan: http://sec.gov/litigation/admin/2007/34-56222-mdp.pdf

Order Approving the Distribution Plan and Appointing an Administrator:

October 6, 2004 Order Instituting Administrative and Cease-and-Desist Proceedings:

For further information, contact:

Marc J. Fagel
Associate Regional Director
SEC's San Francisco Regional Office
(415) 705-2449



Modified: 04/25/2008