A $267 million distribution is being made to mutual funds and mutual fund shareholders who were harmed by late trading and market timing that occurred through Bear Stearns.

More than $216 million was disbursed Friday that will go to approximately 761,000 shareholders who were harmed by the wrongdoing, and to the asset bases of more than 1,000 affected mutual funds, the Securities and Exchange Commission announced. The Bear Stearns Fair Fund will ultimately return more than $267 million to harmed mutual funds and shareholders before the end of this year. Bear Stearns collapsed last year and what was left was sold to JPMorgan Chase.

"We are very pleased to make this first distribution from the Bear Stearns Fair Fund to injured mutual funds and their shareholders and look forward to disbursing the remaining money in the coming months," said James A. Clarkson, acting director of the SEC's New York Regional Office.

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.

The SEC brought and settled public administrative and cease-and-desist proceedings against Bear Stearns & Co. Inc. and Bear, Stearns Securities Corp. in March 2006 for violations of the federal securities laws in connection with late trading and market timing of mutual funds. The SEC's order found that shareholders were harmed by the late trading and market timing of mutual funds facilitated by Bear Stearns from January 1999 through October 2003.

Bear Stearns consented to the order without admitting or denying the findings. Among other things, the order required Bear Stearns to pay $250 million in disgorgement and penalties for distribution through a Fair Fund. The SEC issued an order approving the Bear Stearns Distribution Plan on Feb. 4, 2009.

This distribution is not being made pursuant to a claims process. Therefore, mutual funds and others eligible for distributions from the Bear Stearns Fair Fund do not need to contact the SEC in order to receive a payment.

The Fair Fund Administrator responsible for distribution is Rust Consulting Inc. Investor questions regarding the distribution may be directed to Rust at (888) 356-0259. Information regarding the distribution can also be obtained at http://www.bearstearnsfairfundsettlement.com.