Attorney General Ken Salazar Confirms Investigation of and Settlement Negotiations with Janus Capital Group

Denver—Colorado Attorney General Ken Salazar confirmed today that his office has been conducting an investigation of Janus Capital Group, Inc. concerning market timing activities at the registered investment adviser. Janus offers and sells mutual funds to institutions and individuals under the Janus name. Janus is headquartered in Denver, Colorado, where it employs approximately 1200 people.

Attorney General Salazar said: “I believe that there is a sound basis for us to move forward with formal action against Janus. However, I am also persuaded that Janus is attempting to move forward in good faith to resolve issues concerning market timing in its mutual funds. Janus has represented to me that it is preparing to quickly move forward with significant and specific corporate reforms and is anxious to address all other concerns that have been raised by my office and other state and federal regulators. I hope that we are able to expeditiously arrive at a resolution of the issues of concern that we have with Janus. We will also be working with the Securities and Exchange Commission and New York Attorney General Eliot Spitzer’s office as we move forward in these negotiations.”

After a series of meetings with key Janus officials, including Chief Executive Officer Mark Whiston, Attorney General Salazar will delay the filing of a formal complaint in light of the parties’ ongoing settlement negotiations. At a meeting with Attorney General Salazar this morning, Janus expressed its willingness to move aggressively to address both the market timing and corporate responsibility issues of concern to the Attorney General as well as monetary and civil penalty issues that would have been a part of a complaint.

As part of its investigation, the Colorado Attorney General’s Office has reviewed thousands of pages of documents, including internal Janus memoranda concerning its business practices. The investigation has been conducted under the Attorney General’s statutory authority to enforce the Colorado Consumer Protection Act. As a result of his investigation, the Attorney General was prepared to proceed with a formal complaint against Janus under the Consumer Protection Act. Allegations would have included false representations and failures to disclose material facts to fund shareholders with respect to approved market timing activities within certain of Janus’ mutual funds.