Arkansas Business

It's a lousy time to be a securities dealer in Memphis.

First, the Memphis Commercial-Appeal reported last week that Anthony Cacaro, the senior vice president of international sales for investment bankers Duncan Williams Inc., had been arrested after a parcel of methamphetamine was mailed to his home.

Then, this morning, the Securities & Exchange Commission announced that it had filed administrative charges against eight former directors involved with Morgan Keegan & Co.'s ill-fated "high-income" funds backed by subprime mortgages, some of which burned several Arkansans and even a high-profile NBA star.

Four of the eight directors charged by the SEC are from the Memphis area, including Allen B. Morgan Jr., a founder of Morgan Keegan.

Morgan Keegan, you may recall, had already agreed to a $200 million fine to settle fraud charges related to the same funds.

From the announcement of the charges:

According to the SEC’s order, the eight directors’ failure to fulfill their fair value-related obligations was particularly inexcusable given that fair-valued securities made up the majority of the funds’ net asset values – in most cases more than 60 percent. The mutual funds involved were the RMK High Income Fund, RMK Multi-Sector High Income Fund, RMK Strategic Income Fund, RMK Advantage Income Fund, and Morgan Keegan Select Fund.