Aegon USA Investment Management (AUIM) is under investigation by the Securities and Exchange Commission (SEC) over errors related to an asset allocation models used on a series of Transamerica funds.
The investigation relates to models used in the past in funds that Aegon stopped running in June 2015 at the latest.
Dutch insurer Aegon bought Transamerica in 1999 in a deal worth $10.8 billion.
AUIM has since been appointed a subadvisor on a number of Transamerica mutual funds and variable annuity portfolios.
In terms of mutual funds, the SEC investigation involves the $356.16 million Transamerica Dynamic Income fund and the $19.53 million Transamerica Dynamic Allocation fund.
On the variable annuity side it involves the following:
- Transamerica Managed Risk Conservative ETF VP
- Transamerica Managed Risk Balanced ETF VP
- Transamerica Managed Risk Growth ETF VP
- Transamerica QS Investors Active Asset Allocation Conservative VP
- Transamerica QS Investors Active Asset Allocation Moderate VP
- Transamerica QS Investors Active Asset Allocation Moderate Growth VP
A filing by Transamerica with the Securities and Exchange Commission said: 'The investigation relates to errors in the operation and/or implementation of an asset allocation model utilized by AUIM when it served as subadvisor to the funds, as well as in the operation and/or implementation of an asset allocation model and volatility guidelines utilized by AUIM when it served as subadvisor on the variable annuity portfolios.'
AUIM was dropped as subadvisor on the mutual funds in April 30 2015 and the remaining portfolios on June 30 2015.
A spokesman for Transamerica issued the following statement to Citywire:
‘The SEC is conducting an investigation related to certain investment strategies developed by a former portfolio manager of Aegon USA Investment Management, LLC and offered through Transamerica mutual funds, the underlying separate account in our variable products and separately managed accounts.
‘We do not know when the SEC will complete its investigation or if there will be a material impact, however, we have engaged an independent consultant who has determined that there was no material impact to the performance of the funds or to the separately managed accounts.’
A SEC spokeswoman declined to comment due to the agency’s policy of not discussing ongoing investigations.