Ongoing regulatory investigations into mutual fund trading practices have once again led to disciplinary action against a big-name manager.

In the latest development, the Securities and Exchange Commission announced Bank One Investment Advisors Corp. has agreed to pay $50 million in fines as part of a settlement arising from a probe into the trading practices used for the firm's One Group funds.

As part of the same probe, Mark A. Beeson, senior managing director of BOIA and former president and CEO of One Group Mutual Funds, agreed to a two-year bar from the mutual-fund industry and a three-year ban on serving as an officer or director of a mutual fund or investment advisor.

The allegations against BOIA and Beeson included:
Allowing excessive short-term trading in One Group funds by hedge-fund manager Edward J. Stern as a means to generate new business, resulting in a conflict of interest because the trading raised BOIA's advisory fees and potential harm to One Group funds, according to the SEC. The transaction reportedly earned Stern a profit of about $5.2 million.
Failing to charge Stern about $4 million in redemption fees-the same fees that were charged other investors in the funds.
Failing to collect about $840,000 in redemption fees from a Texas hedge fund that executed two exchange transactions in One Group international funds.
Providing confidential portfolio listings of several One Group funds to Stern and other favored clients-a privilege not offered to the public.
Allowing a Michigan-based market timer to execute about 100 transactions in One Group international funds, which the SEC says was contrary to practices outlined in the fund prospectuses, according to the SEC. The market timer made a profit of about $1.24 million.
Providing loans to both Stern and the market timer for the purpose of investing in One Group funds, which reaped gains for BOAI and Bank One, but resulted in little or no benefit to One Group funds, according to the SEC.

"By allowing Stern to market time in One Group funds, and by providing him with information about the funds' confidential portfolio holdings, Banc One, and Mark Beeson blatantly disregarded the well-being of One Group funds long-term shareholders," says Stephen M. Cutler, director of the SEC's Division of Enforcement.