NASD has ordered three broker-dealer subsidiaries of MetLife, Inc.
to pay up. The industry regulatory body announced
Tuesday that MetLife Securities, New England Securities and Walnut Street Securities must pay a five million dollar fine.
The NASD release cites the firms for allegedly "providing inaccurate and misleading information for NASD, allowing late trading of mutual funds, failing to produce e-mails in a timely fashion and other conduct that violates NASD's rules."
James S. Shorris
, NASD executive vice president head of enforcement, blamed the firms' mistakes partly on their use of a committee.
"Part of the problem in this case stemmed from the decision by the MetLife firms to respond to a regulatory inquiry by relying upon a committee without clear lines of authority or specifically identitfied individuals responsible for the adequacy and accuracy of information that was provided," Shorris stated. "The MetLife Securities Firms' subsequent failure to correct the inaccurate information about the firms' mutual fund trading practices and procedures - a failure that lasted for more than a year - compounded an already unacceptable situation."
According to Shorris, NASD is looking to scare other firms into cooperating.
"Ultimately, this case should send a strong message that NASD expects firms to provide accurate information to regulatory inquiries in a timely manner," Shorris added, "and that failures to provide accurate information will draw severe sanctions."
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