As previously discussed here briefly, on December 3, 2008, the First Circuit reversed the District of Massachusetts’ dismissal of an SEC enforcement action against two former executives of Columbia Funds. I discuss the case in greater detail in this post (click here) on my Enforcement Action blog over at Compliance Week.
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This case is amazing in a number of ways. If, in-fact Tambone approved the deals that were allegedly arranged while he was Co-President of Columbia Fund Distributors, then he should be barred from the industry for life and fined accordingly. If he is found not guilty, you have to wonder “how could he NOT have known this was going on”. Innocent or guilty, what is even more troubling is that Tambone is currently running sales and marketing for Fred Alger & Co. A firm that was also caught-up in the market timing scandal. While he is currently a consultant and not an officer, Tambone does run sales and marketing. He has been there since 10/07, has an office at Fred Alger & Co. (111 5th Ave, NYC), an Alger e-mail address, has held National Sales Meetings, hires / fires…..call him what you want, but this guy is running the show. All this without holding a securities license (no records found for Jim Tambone on FINRA). From a fiduciary stand-point, why would Alger hire this guy? If he is truly innocent, why isn’t he still at Columbia? If I’m the CEO of Alger, this would be the last person I would want running the show. He may be the greatest guy in the world, that wouldn’t matter. As the CEO I feel you have a fiduciary responsibility to your shareholders. How did their Chief Legal Officer allow this? I just don’t understand it.