Janus Shells Out $18 Million, on SEC Orders

Litigation Reports

Janus Capital Management, an investment advisor to Janus Mutual Funds, reimbursed $18 million to more than 325,000 defrauded shareholders late last week as a first step in paying back more than $100 million, as ordered by the Securities and Exchange Commission.

In August of 2004, the SEC found that Janus Capital entered into market timing agreements with 12 entities, and failed to notify its shareholders. Market timing is a strategy where investors buy and sell frequently to try and profit from short-term market cycles.

The agreements permitted the 12 entities to perform more than the commonly allowed four transactions per year, without paying redemption fees. Since waiving these fees imposes the administrative and transaction costs of frequent trading on all the shareholders, Janus Capital had a conflict of interests with Janus Mutual Funds which it failed to disclose to the Board of Trustees.

The SEC censured Janus Capital and ordered it to pay $50 million dollars in disgorgement and $50 million in civil penalties, in addition to interest earned on the money since 2004, totaling more than $100 million.

Shareholders are to be reimbursed for their share of losses due to market timing, and for their share of advisory fees paid by funds that suffered losses during the period of the market timing. To distribute the money to the shareholders in the five affected mutual funds, Janus Capital hired Christopher M. James, an independent distribution consultant.

After a lengthy process of planning and discussion, James started the distribution process that will continue over the coming months.

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USCIS Adjusting Premium Processing Fee

U.S. Citizenship and Immigration Services (USCIS) announced today it is adjusting the premium processing fee for Form I-129, Petition for a Nonimmigrant Worker and Form I-140, Immigrant Petition for Alien Workers beginning on Oct. 1, 2018 to more effectively adjudicate petitions and maintain effective service to petitioners.

The premium processing fee will increase to $1,410, a 14.92 percent increase (after rounding) from the current fee of $1,225. This increase, which is done in accordance with the Immigration and Nationality Act, represents the percentage change in inflation since the fee was last increased in 2010 based on the Consumer Price Index for all Urban Consumers.

“Because premium processing fees have not been adjusted since 2010, our ability to improve the adjudications and service processes for all petitioners has been hindered as we’ve experienced significantly higher demand for immigration benefits. Ultimately, adjusting the premium processing fee will allow us to continue making necessary investments in staff and technology to administer various immigration benefit requests more effectively and efficiently,” said Chief Financial Officer Joseph Moore. “USCIS will continue adjudicating all petitions on a case-by-case basis to determine if they meet all standards required under applicable law, policies, and regulations.”

Premium processing is an optional service that is currently authorized for certain petitioners filing Forms I-129 or I-140. The system allows petitioners to request 15-day processing of certain employment-based immigration benefit requests if they pay an extra fee. The premium processing fee is paid in addition to the base filing fee and any other applicable fees, which cannot be waived.