of backward pricing, the SEC issued Rule 22c-1, requiring forward pricing of mutual fund transactions. This rule was enforced by randomly checking timestamps on orders, but intentional falsification of timestamps was difficult to catch. In addition, New York's Martin Act can be interpreted to prohibit late trading as well, due to the unfair advantage the late trader gains over other traders. "Market timing" Spitzer and later the U.S. Securities and Exchange Commission (SEC) also charged that major mutual fund groups such as Janus, Bank One's One Group, and Strong Capital Management and others facilitated "market timing" trading for favored clients. Market timing is an investment strategy in which an investor tries to profit from short-term market cycles by trading into and out of market sectors as they heat up and cool off. In a novel interpretation of New York's Martin Act, Spitzer contended that fund firms committed fraud when they allowed some clients to trade more frequently than allowed in their fund documents and prospectus. In many cases, funds bar or limit frequent trading because the practice may increase the cost of administering a mutual fund borne by all shareholders in the fund. Market timers also can make managing the fund more difficult since the fund may need to keep extra cash to meet liquidity demands of selling timers, although if timers are trading opposite flows of other investors, they can moderate cash fluctuations. Those funds that did not limit frequent trading in their prospectus—as well as a small number of funds that cater specifically to market timers—were not charged. Spitzer contended that some advisors allowed market timers in order to increase their assets under management (fund advisors are paid based on the amount of assets in the fund). SEC investigation The SEC is charged with the regulation of the mutual fund industry in the United States. Following the announcement of Spitzer's complaint, the SEC launched its own investigation of the matter which revealed the practice of "front running". The SEC claimed that certain mutual fund companies alerted favored customers or partners when one or more of a company's funds planned to buy or sell a large stock position. The partner was then in a position to trade shares of the stock in advance of the fund's trading. Since mutual funds tend to hold large positions in specific stocks, any large selling or buying by the fund often impacts the