MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
|
|
MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Tuesday, April 14, 2009 A State Sues OppFunds Over 'Hedge-Fund Like' Risks OppenheimerFunds just got hit by another lawsuit over a fixed income fund, and this time a state is the plaintiff. The Wall Street Journal's Shefali Anand and Craig Karmin report that Oregon filed suit on Monday against the New York-based MassMutual subsidiary over $36 million in losses suffered by participants in the Oregon 529 plan who used the Oppenheimer Core Bond Fund. OppFunds also faces a number of class action suits over losses in its Champion Income Fund and one suit over its California Municipal Fund (see MFWire, 2/13/2009, 3/5/2009, 3/12/2009 and 3/18/2009). And in the wake of fixed income woes and the broader market pain of 2008, OppFunds has already said goodbye to its CorePlus team leader, its chief investment officer and a number of other employees, while its fixed income chief stepped aside (see MFWire, 12/16/2008, 1/9/2009, 1/27/2009 and 3/31/2009). The Oregon attorney general's complaint claims that the Oppenheimer Core Bond fund became much more risk in the last two years, thanks to total-return swaps (i.e. bets) on high-quality commercial mortgage-backed securities, according to the WSJ. "The Core Bond Fund was no longer a plain bond fund," Oregon alleges. "It had become a hedge-fund like investment fund that took extreme risks." OppFunds spokeswoman Jeaneen Pisarra told MFWire that the fund firm is "very disappointed by the actions of the [Oregon] attorney general." "Despite our cooperation and ongoing dialogue with the state, Oregon went head and filed suit without discussing their concerns or potential solutions," Pisarra told MFWire. "OppenheimerFunds is prepared to defend itself vigorously against these claims, which lack legal merit." Printed from: MFWire.com/story.asp?s=21286 Copyright 2009, InvestmentWires, Inc. All Rights Reserved |