News Flash- AIM to Disclose Money Directed at Brokerages
March 29, 2004
AIM Investments has stepped up efforts to publicly disclose its directed-brokerage activities and allocation of marketing fees. Newly drafted prospectus supplements filed with the SEC clearly outline the fund provider's intent to reveal non-binding sales goals with third-party brokerage firms and other potential investment distributors, a move lauded by shareholder advocates but implemented by very few asset managers.
Part of AIM's new efforts to shed light on its directed brokerage practices include acknowledgements of quid-pro-quo relationships based on "execution services" and "research services" provided by individual brokers. The new disclosures also make note of relationships that are potentially influenced by brokerage firms' recommendations to sell AIM's proprietary funds.
Separately, AIM now provides greater details about 0.25% annual "Sales-Based-Payments" for marketing support to brokerage firms. Secrecy surrounding these types of payments has raised suspicions in recent months among regulators and shareholder advocates.
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