FleetBoston’s Specialist Unit Settles With SEC, NYSE

FleetBoston Financial Corp. has disclosed that its Fleet Specialist Unit will pay $59.4 million in a settlement with the Securities and Exchange Commission and the New York Stock Exchange.

The settlement stems from an investigation of the NYSE’s five largest specialist firms, who were accused of failing to oversee traders who improperly traded ahead of their customers. In a preliminary agreement announced Feb. 17, the specialists agreed to pay a total of $240 million — $155 million in disgorgement of ill-gotten gains plus penalties of about $85 million.

Until FleetBoston Financial made its annual filing Tuesday with the SEC, it was not known how much Fleet Specialist Inc. would pay in restitution and penalties.

The Boston bank holding company said the settlement includes a censure, a cease-and-desist order, and an "undetermined form of undertaking," according to the Wall Street Journal. It also said the settlement wouldn't resolve regulatory charges against individuals.

The agreement involves no admission or denial of wrongdoing and is subject to approval by the SEC and NYSE.

The other specialists involved in the Feb. 17 settlement are: Bear Stearns Cos.' Bear Wagner Specialists; Goldman Sachs Group Inc.’s Spear, Leeds & Kellogg; LaBranche & Co.; and Van Der Moolen Holding NV's Van Der Moolen Specialists USA. All deny wrongdoing.

The SEC contends that investors were shortchanged by at least $155 million over three years because the NYSE failed to police its specialists and overlooked obvious violations.

You may like these other stories...

AgFeed agrees to pay $18 million to settle SEC accounting fraud caseMichael Rapoport of the Wall Street Journal reported on Monday that AgFeed Industries Inc. has agreed to pay $18 million to settle US Securities and...
Hertz and Icahn make peaceThere won’t be any nasty, protracted proxy battle between Hertz Global Holdings and activist investor Carl Icahn. The rental car chain agreed last Thursday to give Icahn – who has...
Following other recent high-profile hacking events, investigators discovered yesterday that hackers broke into the draft work paper files of several famous CPA firms. Revealing images of the scantily clad documents have been...

Already a member? log in here.

Upcoming CPE Webinars

Sep 18
In this course, Amber Setter will shine the light on different types of leadership behavior- an integral part of everyone's career.
Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.