The two founders of mutual fund company Pilgrim, Baxter & Associates agreed to pay a combined $160m (€122m) in penalties and accept lifetime bans from the securities industry in a record settlement by individuals involved in the US mutual fund trading scandal.

The largest previous individual settlement was reached by Richard Strong, another money manager, who agreed in May to pay $60m, accept a lifetime ban and offer a public apology to investors for trading frequently among his Strong Funds.