Court Freezes Assets of Three Heartland Group Funds

The Securities and Exchange Commission received an injunction against investment company Heartland Group for failing to disclose financial information on three of its funds.

A U.S. District Court in Illinois also froze the assets held in Heartland's High Yield Municipal Bond Fund (HRHYX Quote - Cramer on HRHYX - Stock Picks), Short Duration High-Yield Municipal Fund (HRSDX Quote - Cramer on HRSDX - Stock Picks) and Taxable Short Duration Municipal Fund (HRTMX Quote - Cramer on HRTMX - Stock Picks). A receiver will take control of the funds' assets, manage them, suspend redemptions and liquidate them if necessary.

According to the SEC, Heartland Group consented to the order without admitting or denying any of the agency's allegations. Heartland didn't return calls for comment.

The SEC claimed that Heartland Group violated a number of federal laws by failing to file timely reports on the funds for fiscal 2000, as the group's accountants were unable to properly audit the funds because of the valuations of some of their holdings.