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The worst may be over for mutual fund investors.

Beleaguered fund firm INVESCO and partner AIM Investments, both subsidiaries of Amvescap (NYSE: AVZ  ) of London, yesterday settled charges related to the ongoing mutual fund scandal for $450 million in fines, restitution, and reduced fees.

The settlement is no slap on the wrist. Nor should it be. INVESCO and operating partner AIM allowed certain investors to trade in and out of their funds without restriction. The practice is called market timing and tends to steal profits away from long-term individual shareholders. Although not illegal, market timing is incredibly sleazy and would have gone undetected were it not for a whistle-blower uncovering the slimy doings at Canary Capital Partners.

Moreover, TheWall Street Journal, citing New York Attorney General Eliot Spitzer's legal complaint against INVESCO, says the scandal went all the way to the top, naming former chief executive Raymond Cunningham as complicit in permitting market timing. Notably, Cunningham has yet to make a deal with the Feds, although the Journal's sources say one is at hand.

In Denver, the involvement of INVESCO and Janus Capital (NYSE: JNS  ) in the fund scandal has cut deep. After all, INVESCO has plastered its name all over the new Mile High Stadium. Every national Broncos home broadcast places a spotlight on the debacle. For the sake of investors and my hometown, I'm pulling for INVESCO to restore its former glory.

But don't expect that to happen soon. Of the $450 million decreed, $375 million encompasses penalties levied by Spitzer and the Securities and Exchange Commission. That equals the fine imposed on Bank of America (NYSE: BAC  ) and nears that paid by Alliance Capital (NYSE: AC  ) . But Bank of America and Alliance are huge; INVESCO isn't. To help INVESCO stay afloat, Spitzer has agreed to allow the firm two years to pay its obligations.

The good news in all this is that the fund scandal may finally be winding down. Sure, there are still several firms under investigation, and more instances of market timing may be found. But INVESCO was one of the real bad guys. When it was first charged, the response of now-departed INVESCO executives resembled the corporate equivalent of a temper tantrum. Fortunately, those days are gone, and investors, and INVESCO, can finally move on.

For more Fool coverage of the fund scandal:

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Fool contributor Tim Beyers also thinks the seemingly inevitable NHL strike will be a blow to Denver. It could be a long, boring winter indeed. Tim owns no interest in any of the companies mentioned, and you can view his Fool profile here.

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