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Compliance July 31, 2007
Prudential Executive Fined by SEC for Market Timing Scandal
The Securities and Exchange Commission (SEC) has fined former Prudential Securities executive Michael Rice and barred him from working in the securities industry for not putting a halt to improper market timing practices, Reuters reported.
Reported by Adrien Martin
According to the news report, the SEC alleged that Rice headed the firm’s brokerage operation and was aware that some of Prudential’s brokers flouted warnings from mutual funds to stop market timing practices.
Rice neither admitted or denied the SEC’s charges, but will pay a $100,000 fine and is prohibited from supervising any broker dealer or investment adviser for 12 months.
“Due in part to Rice’s failure to take effective action, the registered representatives’ widespread use of fraudulent and deceptive practices continued until at least June 2003,” the SEC said, according to Reuters.
Prudential agreed to pay $600 million to settle investigations of improper mutual fund trading in August.