Millennium Partners' Latest Dirty Laundry

The settlement with Millennium, which comes more than two years after the mutual fund trading scandal first made headlines, is the second involving a hedge fund. Millennium set aside money to cover the cost of a settlement back in December 2003. Sources say settlement talks are going on with at least two other hedge funds that engaged in abusive mutual fund trading, but neither is still active and the funds weren't as large as Millennium.

The other hedge fund to pay a fine in the mutual fund scandal is Canary Capital Partners, the defunct shop led by Edward Stern. Stern's $40 million settlement with Spitzer in September 2003 launched the mutual fund investigation.

Two years later, the investigation is in its final stages, with just a few big cases still to be resolved. To date, regulators have collected nearly $3 billion in fines and restitution from dozens of mutual fund companies, brokerages and hedge funds.