Putnam Investments, the Boston-based fund manager, has been re-hired to run money for the $31bn (€25bn) Massachusetts public pension fund, a year after it was fired for its involvement in the improper US mutual fund trading scandal.

The state fund of Massachusetts was the first to fire Putnam after it was revealed that the firm had been implicated in the scandal that has swept the $7trillion US mutual fund business for the past year.