The last thing Japan's struggling mutual fund industry needed was a scandal, but that's what it got. The trigger came as a surprise the collapse of US energy trader Enron. But it struck at an area long known to be vulnerable by the industry and regulators managed money funds MMFs, unregulated portfolios widely believed by investors and many asset management companies to be as safe as bank deposits.
But there's no such thing as a free lunch. Japanese investors, both retail and institutional, enthusiastically poured money into MMFs, eager to reap the higher yield while everyone - investors, regulators, industry organizations, distributors and fund managers - revelled in the delusion that such...
