Two of Europe's biggest insurance groups, ING and Aegon, said on Wednesday they had been approached by U.S. regulators with regards to a wider probe into a market timing scandal.
The two Dutch firms, among the biggest foreign insurers in the United States, said they were cooperating fully with the U.S. Securities and Exchange Commission in its probe into market timing practices, a scandal that has hobbled the U.S. fund industry and involved many top financial names.
ING, Europe's No. 3 insurer, said the SEC has requested information on its variable annuity insurance products.
Aegon admitted it was involved in the probe and that it had responded to "general inquiries," confirming what an industry source had earlier told Reuters.
U.S. regulators are conducting a widespread investigation into market timing and late trading of mutual funds, including underlying variable life and annuity products, by financial services firms who operate in the United States.
Late trading involves illegal after-market trading at the current day's price. Market timing, which is legal but widely discouraged by mutual-fund firms, is the rapid dashing in and out of portfolios to take advantage of pricing inefficiencies.
"We have received several requests for information from the SEC on variable annuities. We are cooperating fully," ING Groep NV spokeswoman Dailah Nihot said.
A spokesman for Aegon, which reports 2003 results on Friday, said: "We have responded to general inquiries by the SEC, as many other firms have done."
The market timing and late trading scandal has rocked the U.S. fund industry since it was uncovered last September by New York Attorney General Eliot Spitzer, who launched a sweeping investigation into the practices of major U.S. funds.
Names involved in the various probes include Bank One Corp. , Bank of America Corp., Janus Capital Group and Prudential Securities.
Last November regulators and prosecutors turned their attention to the insurance sector.
The SEC has requested information on internal firewalls against market timing and late trading of variable annuities -- investments offered by insurance companies that let customers put savings into stock, bond or money market funds.
