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TRAVELERS EYES MONEY MANAGER Don’t be shocked if a money-management firm is next to find itself under the…

TRAVELERS EYES MONEY MANAGER

Don’t be shocked if a money-management firm is next to find itself under the Travelers umbrella. Six months after carving a stand-alone asset-management division out of its Smith Barney subsidiary, the acquisitive Travelers Group is on the prowl for a money manager, a senior executive told a gathering of bankers in New York last week. “If I were to speculate on where the next acquisition comes from, that’s a pretty good place,” Vice Chairman Jon C. Madonna said. “We just clearly haven’t kept pace in terms of that marketplace.” The new division, dubbed Smith Barney Asset Management, managed $164 billion at yearend, including $98.4 billion in money market and other mutual funds, and $65.7 billion in other institutional and individual assets.

Author reimburses investors

After eight years of wrangling, best-selling personal finance author Wade Cook has paid $320,000 in restitution to Arizona investors under the terms of a 1990 Arizona Corporation Commission order finding that he fraudulently sold unregistered securities to approximately 175 investors. Mr. Cook also paid a state-ordered fine of $150,000, according to a statement released by the state commission. The Cook organization could not be reached for comment.

The commission found that in the late 1980s, Mr. Cook and his Seattle-based companies, American Business Alliance and Monarch Funding Corp., used investor money to pay for his personal residence and past debts to the Internal Revenue Service. The restitution will be distributed to investors who purchased shares in American Business Alliance or several other penny-stock firms. Mr. Cook had put his battle with the state commission on hold in 1990 when criminal racketeering charges were filed against him in Arizona, said corporations commission spokeswoman Sharon Fox. The case ended in a settlement last year, with Mr. Cook and his organizations paying $70,000 to investors, Ms. Fox said.

No bomb on Wall Street

Bill Clinton and U.K. count
erpart Tony Blair were rattling sabers at Saddam Hussein on Friday, and American investors couldn’t have cared less. The Dow Jones industrial average ended the day at 8189, up 72.24 points, even after crude oil prices jumped 2% on worries about American bombs cutting off exports. How come? “The economic effect of a war with Iraq would be pretty trivial” on the United States, says Mark Stumpp, senior managing director of Prudential Investments’ quantitative research division.

Circuit-breaker shock

The New York Stock Exchange proposal to shut down trading for the day after a severe drop in stock prices would impose “artificial constraints” on the stock market, a key lawmaker said in a letter to Securities and Exchange Commission Chairman Arthur Levitt last week. Rep. Michael Oxley, R-Ohio, chairman of the House Commerce subcommittee on finance, writes that a percentage-based circuit breaker “could prove extremely hazardous to our markets.” The NYSE proposal, adopted Thursday, would close the nation’s exchanges in the event of a 30% drop.

Van Eck in adviser push

In a push to beef up sales of its growing cadre of load funds, New York-based Van Eck Global has hired Robert Langel, former chairman of now-defunct Palladian Marketing Group, to fill the newly created position of national sales manager focusing on financial planners and broker dealers. The move comes on the heels of the launch last month of the firm’s first-ever hedge funds, which include one domestic and one offshore, and the hiring of Gary Greenberg from Peregrine Asset Management, where he served as subadviser to Van Eck’s emerging markets funds.

Alliance wraps up first client

Lockwood Financial Services Inc. and Wheat First Union signed on their first brokerage since they hooked up to offer a new compensation structure in December to lure advisers. The two firms, which together provide wrap accounts to individual advisers, signed on Legacy Advisory Inc., a Richmond, Va.-based firm that supervises about $100 mil
lion in assets.

Etc.: Old firm, new push

MFS Investment Management, the country’s oldest mutual fund company is about to unveil a $6 million print advertising campaign around its slogan, “We created the mutual fund.” . . . Pressure from investors, including shareholder activist Ralph Whitworth and Franklin Mutual Advisors Inc.’s Michael Price, finally drove Costa Mesa, Calif.-based Apria Healthcare Group Inc. into a deal that raised $172.2 million. The infusion came from Joseph Littlejohn & Levy. The plan awaits shareholder approval. . . . The Seligman Select Municipal Fund went into a tailspin on Friday after Salomon Smith Barney cut its rating on the closed-end fund to “sell” from “neutral” based on concerns that its shares are overvalued. Seligman officials were unavailable for comment.

Correction

The Feb. 2 Stats page incorrectly identified two Fortis Benefits products. They are the Opportunity Variable Annuity Aggressive Growth and the Opportunity Variable Annuity High Yield.

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