Five mutual fund companies have been granted an additional two years to distribute settlement funds to investors affected by frequent trading market-timing activities that occurred earlier this decade.

The Ontario Securities Commission announced on July 22 that AGF Funds Inc., AIC Ltd., CI Investments Inc., I.G. Investment Management, Ltd., and Franklin Templeton Investment Corp. were each granted a two-year extension on paying settlement funds to the investors affected by the mutual fund market-timing scandal that took place between January 1999 and September 2003.

Under the original plan of distribution, which was approved by the OSC in June 2005, the companies had until shortly after June 1, 2008, to use “reasonable efforts” to attempt to locate the affected investors and distribute the $205.6 million in settlement funds. Following the deadline, the plan specified that any unclaimed settlement funds would be distributed the mutual funds to the benefit of all investors in those funds.

Due to the recent extension, the companies now have until shortly after June 1, 2011, to locate affected investors and distribute the funds.

The OSC said extending the deadline was in the public interest. It marks the “final extension,” following a separate one-year extension granted in June 2008, the OSC said.

As of June 2, 2008, the companies had distributed $190.7 million, or 93%, of the total settlement funds, leaving $14.9 million in unclaimed funds.

IE