The Obama administration said Thursday that a program used to guarantee as much as $3 trillion in money market mutual fund assets will end on schedule next week, according to Associated Press.
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The program, which will be closed down on Sept. 18, had no direct cost to taxpayers and earned more than $1 billion in fees paid by the mutual fund industry, according to the Treasury Department.
Investors were exposed to losses after the Primary Reserve Fund conceded that $785 million it had invested in the debt of Lehman Brothers became worthless after the investment bank's bankruptcy in September 2008.
The collapse of the fund run by Reserve Management Co. last fall was only the second such instance in the nearly four decades that money-market funds have been available.
The "breaking of the buck" by the Primary Fund, which was established in 1970 as the first
The Securities and Exchange Commission later charged Reserve Management and its two top executives with civil fraud, saying they withheld key facts from investors. The firm and the executives have said they will defend themselves against the SEC's allegations.
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