The report stems from an insider trading inquiry into stock purchases by The Retirement Systems of Alabama (RSA), a state pension fund. RSA purchased shares of The Liberty Corporation while in possession of material, non-public information about the prospective acquisition of Liberty. RSA learned about the transaction because it was to provide financing for the acquisition. When the information became public, the value of RSA's Liberty shares increased by more than $700,000.

RSA did not have any program, policy, practice, or training to ensure that its investment staff understood and complied with the federal securities laws in general, or insider trading laws in particular.

"While public pension funds are exempt from most of the federal securities laws governing other money managers, they are not exempt from important anti-fraud provisions that prohibit insider trading and other manipulative and dishonest behavior that threatens the integrity of our markets," said SEC Chairman Christopher Cox. "It is vitally important, therefore, that they have appropriate policies and procedures."

RSA took remedial action once the SEC began its investigation, including adoption of a compliance program and compensation to the sellers of the Liberty stock that it purchased. RSA's trading was directed by its CEO, who cooperated in the investigation and authorized RSA's remedial action. No individual personally profited from RSA's trading.