Bank of America to give shareholders 'restitution'

Bank of America said today it will make "appropriate restitution" to shareholders as it moved to address allegations of improper…

Bank of America said today it will make "appropriate restitution" to shareholders as it moved to address allegations of improper trading at its Nations Funds unit.

The bank also said Nations Funds will hire an independent firm to assess if the funds were hurt financially.

The funds will be reimbursed for all fees that were the subject of a market-timing agreement with hedge fund Canary Capital Partners, the bank added.

Bank of America said it will continue co-operating with government and regulatory authorities to resolve the matter.

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New York Attorney General Mr Eliot Spitzer last week said Nations helped Canary conduct "late trading". This method involves trading mutual funds after-hours at stale prices, enabling a trader to make profit and avoid losses in ways ordinary investors cannot.