(September 9 – 16: 35 ET) The Securities and Exchange Commission has
settled fraud charges against several firms and individuals in a case
involving payment of “soft dollar” commissions.

The SEC brought charges against Fleet Investment Advisors Inc.,
eight individuals, including Michael Rothmeier, the former president of
Shawmut Investment Advisers Inc., and East West Institutional
Services Inc., a Michigan brokerage firm.

Shawmut has since been acquired by Fleet and therefore becomes
vicariously liable. The SEC alleges that Shawmut fraudulently used
US$1.8 million worth of brokerage commissions to pay for client
referrals.

The SEC also found that Shawmut traders doctored their trading
records to make it look like the favoured brokerge, East-West, had the
best price on certain trades.

Fleet has settled its charges, without admitting or denying them,
agreeing to cease and desist and paying more than US$1.9 million to
clients whose accounts were used to pay for referrals. The traders
involved have also settled, agreeing to cease and desist, each paying
a US$5,000 fine, and a 15 month suspension.

-IE Staff

For more please see:


www.sec.gov