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Russell advises on conflicts amid SEC probe

US - Russell Investment Group says it has started providing its US consulting clients with a document which addresses its potential conflicts of interest.

The move comes amid a report into conflicts of interests in the US pension consulting market by the Securities and Exchange Commission.

“As of last week, we provided our US consulting clients with a Conflicts Disclosure Document that addresses potential conflicts of interest, and we have renewed our commitment to our clients to be more proactive with our disclosures in the future,” the firm said in a statement. It would discuss the matter with clients at regular meetings.

Russell’s clients in the US include names such as AT&T, the Bill and Melinda Gates Foundation, General Motors, Nestle and United Airlines. European clients include BASF Pensionskasse, Civil Aviation Authority, Electricite de France and J Sainsbury.

The firm added: “Russell received the SEC report on pension consulting. We welcome the attention to this issue and continue to cooperate fully with the SEC review.” It said it has a “long-standing policy of addressing potential conflicts with full and timely disclosure. We openly discuss this issue with clients on a regular basis, and we outline our policies and practices in our Corporate Code of Ethics.”

Meanwhile, Watson Wyatt has said it is not in a position to say more on the issue at the moment.

It said: “We have seen the SEC’s report concerning its examination of pension consultants and are supportive of the SEC's goal of more disclosure.

“At this point, however, we are not in a position to say more, as we have not yet received final word from the SEC about the status of their examination.

“Again, we continue to support and comply with the SEC’s work in this area.”

Hewitt Associates said: "Hewitt was not one of the 24 pension consulting firms examined by the SEC in its report.  

"We have strict policies regarding our pension fund consulting practices, and we are glad the SEC is recommending the industry implement stricter policies and procedures that would lead to full disclosure of companies' practices."

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