Prudential Pays $32.6 Million to Settle Probe of Mutual-Fund Business

WASHINGTON—Prudential Financial Inc. agreed to pay $32.6 million to settle claims that it didn’t disclose how a reorganization of its mutual-fund business would cost the funds millions in lost interest income. The Securities and Exchange Commission on Monday said the 2006 reorganization—intended to engineer tax benefits for Prudential—created a conflict of interest because the company benefited while the funds lost income from securities lending. They also paid higher taxes in certain foreign jurisdictions. In addition to…

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