Late-trading and market-timing are the two main trading offenses at the center of the mutual fund investigation. Late-trading, which is illegal, involves buying shares of a mutual fund after the close of trading, but at an old price that doesn't reflect the impact of late-breaking market developments. Market-timing, which is not illegal, entails the frequent trading of mutual fund shares, often in violation of fund company rules. Despite the increased grand jury activity, prosecutors are not believed to be close to filing criminal charges against anyone else at Millennium. People familiar with the inquiry said investigators with New York Attorney General Eliot Spitzer are still trying to determine what, if anything, Englander may have known about any improper mutual fund trading. Englander, because of his past dealings with some of Wall Street's more notable characters, would represent a high-profile catch for securities regulators. Back in the 1980s, Englander was a friend of convicted Wall Street felon Ivan Boesky. Later, he was partner in a buyout firm with John Mulheren, the storied arbitrager who was arrested on gun charges in 1988. Mulheren, who died late last year, was convicted of insider trading in the investigation that brought down Boesky. The conviction was later thrown out on appeal. A Spitzer spokesman declined to comment. A Millennium attorney, Martin Pershetz, a former federal prosecutor and a partner at Schulte Roth & Zabel in New York, didn't return phone calls over a period of several days. Harry Davis, another Schulte Roth attorney who does work for Millennium, declined to comment. Tom Daly, a spokesman for the fund, also declined to comment. The increased grand jury activity comes at a time when Millennium is taking steps to fortify its regulatory and compliance operation. Last month the hedge fund hired Simon Lorne, a former Securities and Exchange Commission general counsel, as a vice chairman and chief legal officer. Some people familiar with the Millennium investigation see Lorne's hiring as setting the stage for a possible settlement between Millennium and regulators and prosecutors.