Massachusetts Begins Probe Into BNY Mellon Over Mutual Fund Glitch

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Massachusetts Begins Probe Into BNY Mellon Over Mutual Fund Glitch

Massachusetts Secretary of State William F. Galvin announced he has decided to initiate an inquiry into the technical glitch at Bank of New York Mellon that caused led to major pricing problems in mutual funds and exchange-traded funds late last month.

Galvin supervises the Massachusetts Securities Division as part of his purview, and noted on Tuesday that the state had sent letters requesting more information from New York-based BNY Mellon and six of the largest mutual funds impacted  by the software glitch. He also noted that MSD is also investigating the extent that the technical issues could have hurt individual investors.

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No one is suggesting that anything illegal occurred, but it is important to understand what actually caused the major mutual fund glitch that led to erroneous pricing so it can be prevented in the future.

BNY Mellon did not have an immediate comment on the Massachusetts Secretary of State’s announcement.

Statement from Massachusetts Secretary of State William F. Galvin

“In the warp-speed of trading these days computer problems can happen,” Galvin commented in a statement. “But the fallout that seems only to affect large financial institutions can hit the average investor looking at his and her retirement money.”

More on August mutual fund glitch

According to the statement from Galvin, the first round of letters were sent to Goldman Sachs, Deutsche Bank, First Trust Advisors, Guggenheim Investments, Prudential Investments and Federated Investors.

The issue crop