The SEC announced that it will fine Pax World Management $500,000 for violating its own restrictions on buying stocks. Pax World is a 'socially responsible' investment company, operating mutual funds that do not invest in companies which produce harmful things like weapons, alcohol and tobacco.
I guess the return on cluster bombs and cancer sticks was just too tempting.
Pax has issued a statement in which CEO Joseph F. Keefe apologizes for the violation of its self-imposed rules. (He also makes it clear that it occurred before he became CEO). Keefe states that investors were not harmed financially.
By way of explanation, Pax cites the SEC's Settlement Order, which states that between 2001 and 2005, two of Pax's mutual funds bought stocks "that either were not socially screened prior to purchase or had failed a screen. Of these, 10 securities (out of approximately 650 purchased by Pax World Funds during that time period) actually failed the social screens and therefore should never have been purchased."
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