In a classic case of unintended consequences, mutual funds companies are now revealing their shareholdings to the SEC and the world in public filings. Here's the WSJ's article (link to DKGroup and Emergent Chaos):
Mutual Funds Reveal Clients' Data on Web
Wall Street Journal
Lois Hatten, a 60-year-old widow of a truck driver in Otsego, Mich., was astonished to find out recently that her Individual Retirement Account number was posted on the Internet, along with her name, home address and the approximate number of shares she holds in two mutual funds. Even more surprising is who made the disclosure: her mutual-fund firm, Armada Funds.
In what appears to be a significant privacy breach, some of the nation's leading mutual-fund companies have publicly disclosed similar information about certain of their customers. The postings are readily accessible on a U.S. government Web site, and could leave these individuals vulnerable to identity theft or other crimes.
"I was pretty shocked," said Ms. Hatten, a retired former grocery-store employee, when told by The Wall Street Journal about the posting. "Nobody should know my business."
Among other fund companies that have made some customer account numbers publicly available: Pimco, a unit of German insurance giant Allianz AG; the Dreyfus unit of Mellon Financial Corp.; Bank of America Corp.'s Columbia Funds unit; Nuveen Investments; the First American Funds unit of U.S. Bancorp; AmSouth Bancorp's fund unit, and the CNI Charter fund unit of City National Bank of Los Angeles.
The leaks can be traced, in part, to Securities and Exchange Commission regulations that require fund firms to disclose the name, address and percentage ownership of any owner of more than 5% of a particular class of any mutual fund. The provision is meant to let shareholders know of anybody who might be in position to control or influence the fund.
Posted by iang at March 24, 2005 01:03 PM | TrackBack