Thursday, March 16, 2006

Bear Stearns Settles Market Timing and Late Trading Case

Bear, Stearns & Co. settled with the SEC and New York Stock Exchange in connection their investigations of its conduct in facilitating market timing and late trading in mutual funds.  The firm agreed to pay a $90 million fine and disgorgement of $160 million in addition to compliance measures to prevent such transactions in the future.  The SEC's admininistrative order (here) provides details of how the firm helped hedge funds and other institutional customers circumvent trading rules of mutual funds designed to prevent the market timing and late trading who cleared their trades through Bear, Stearns subsidiaries.  The order includes portions of recorded conversations in which traders expressed thanks for receiving tickets, spa gift certificates, and other benefits.  (ph)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2006/03/bear_stears_set.html

Civil Enforcement, Securities, Settlement | Permalink

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