401(k) Corral Fight

The mushrooming mutual fund scandal has edged into the relatively staid world of 401(k) plans. While the majority of 401(k) participants stashes their money in tax-deferred accounts and leaves it alone, some take advantage of the so-called "stale pricing" of mutual fund shares to jump in and out of funds, especially international funds, to make a short-term profit. Some companies are taking steps to put an end to the practice. Putnam Investments, already out some $32 billion since the fund scandal broke, has terminated its contract with the Boilermakers Union, Local 5, in New York. Some market-timing members of the union made more than $4 million over 3 years, using in-and-out trading in Putnam's international funds, a practice that put the brokerage firm into hot water in the first place.