The list of mutual fund scofflaws keeps growing. San Francisco-based Fremont Investment Advisors is the latest money manager to disclose that securities regulators are poised to charge the firm for permitting wealthy investors to make improper trades. Fremont, which manages Fremont Mutual Funds, said in a regulatory filing that the Securities and Exchange Commission is considering bringing an enforcement action because the firm had "market timing arrangements with a few clients that may have been inconsistent with the adviser's and the fund's own policies." While market-timing, which involves frequent trading of mutual fund shares to capitalize on small price discrepancies, is in theory a legal trading strategy, regulators have been prosecuting fund families that allowed it in violation of policies outlined in their prospectuses. To date, nearly two dozen mutual fund companies and brokerage firms have been implicated in the far-reaching investigation into improper trading activity in the $7 trillion mutual fund business. In another development in the investigation, sources said Bank of America ( BAC), one of the first financial services firms to be implicated in the scandal, is close to reaching a settlement with the SEC and New York Attorney General Eliot Spitzer. A former Bank of America broker is facing criminal charges on allegations he helped the Canary Capital Partners hedge fund engage in late trading of mutual fund shares. Late trading is a more serious offense than market timing and is being prosecuted as a crime by regulators. It means a mutual fund company permitted a favored customer to buy shares that were priced prior to the release of market-moving news, giving the investors an unfair advantage. Meanwhile, Fremont, in the regulatory filing, said its last market-timing arrangement ended in October 2002. The firm said the employees who negotiated those market-timing deals are no longer with the fund company.