"Schwab Seeks to Fend Off SEC Lawsuit Over YieldPlus" writes Bloomberg. It says, "Charles Schwab Corp. says it shouldn't be sued by U.S. securities regulators for switching half of the assets in its YieldPlus mutual fund into mortgage-backed securities without gaining shareholder approval. Schwab ... tried to dissuade the Securities and Exchange Commission from bringing a variety of claims over YieldPlus, once the world's largest short-term bond fund, according to excerpts of the firm's communications with the agency filed in federal court in San Francisco. Schwab is already fighting an investor suit over the fund, which lost 35 percent before dividends in 2008 amid the collapse of the housing market." The piece adds, "YieldPlus peaked at $13.5 billion in assets in 2007, and had $184 million as of Feb. 28, Bloomberg data show. The fund fell because of redemptions amid the credit crisis. From 2006 to 2008, the fund's investments in mortgage-backed securities backed by home loans not guaranteed by the government grew to 50.1 percent, according to shareholder lawsuits."

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