Customer Letters About Breakpoint Refunds
NASD directed all firms that processed more than a minimal amount of mutual fund transactions using an automated process to conduct a self-assessment of their mutual fund transactions in 2001 and 2002 and the sales discounts provided, and to submit the results to NASD. As of July 30, 2003, the 642 firms listed below submitted assessment results to NASD.
Based on an evaluation of those results, NASD then directed about 450 of those firms to send letters and claim forms to their mutual fund customers who purchased Class A mutual fund shares since January 1, 1999, notifying them that they may be due refunds as a result of the firms' failure to provide breakpoint discounts.
Whether or not firms were required to send out a customer letter, and which letter the firm was required to send, was based on the firm's evaluation of its delivery of accurate breakpoint discounts. NASD directed almost 175 of those firms with poor records of providing breakpoint discounts to complete a comprehensive review of transactions since the beginning of 2001 for possible missed discount opportunities. Those firms will then be sending out to customers the "Trade by Trade Refund Notification Letter."
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