updated 12/8/2003 5:27:08 PM ET 2003-12-08T22:27:08

The California State Teachers’ Retirement System, the nation’s third-largest pension fund, announced Thursday it has ended its relationship with Putnam Investments, the latest of a series of investors to fire the embattled company.

CalSTRS has been pulling its $312 million out of the Boston-based mutual fund company for the past few weeks, said CalSTRS spokeswoman Sherry Reser.

“After very careful scrutiny and investigation by our investment staff and our chief investment officer,” the pension fund still had questions and concerns about Putnam and their operations, Reser said.

Putnam, the nation’s fifth largest fund company, was accused in October of allowing improper trades by the Securities and Exchange Commission and state of Massachusetts. The SEC reached a partial settlement with the company last month, but no agreement has been reached with Massachusetts regulators.

Since the scandal became public, Putnam has lost more than $32 billion in assets, including a $1.2 billion withdrawal by the California Public Employees Retirement System, the nation’s largest pension fund.

CalSTRS’ investment with Putnam was a small part of its total portfolio of $103 billion, and its accounts were not affected by the company’s infractions, Reser said.

Still, the pension fund’s leadership “felt we would be better served taking our money elsewhere,” Reser said.

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