With billions of dollars of client money at stake, broker-dealer Ameriprise Financial Inc. on Friday sued New York fund manager Reserve Management Co., alleging it tipped off big institutional investors about its troubled money-market fund, the Primary Fund, but not smaller investors.
The Primary Fund announced earlier this week that its net asset value fell below $1 to 97 cents, meaning clients lost money in a fund considered as safe as cash. Ameriprise said it filed the suit "to protect the interest of its retail investor clients," who have $3.2 billion invested in the Reserve Primary Fund. The companies also have millions of their own capital invested.
The U.S. Treasury announced Friday that it will insure money-market funds against losses for the next year as it seeks to prevent a run on the industry's $3.35 trillion of assets.
No comments:
Post a Comment