State to Receive $337,500 in Securities Settlement

first_imgVermont to Receive $337,500 in Securities Settlementwith Deutsche Bank Securities and Thomas Weisel PartnersMontpelier, VT (August 26, 2004) – Under the terms of settlements announced today betweensecurities regulators and Deutsche Bank Securities Inc. and Thomas WeiselPartners LLC, Vermont stands to receive $337,500 in total fine money uponfinal acceptance of the terms of the agreement, said John P. Crowley,Vermont’s Commissioner of Banking, Insurance, Securities and Health CareAdministration (BISHCA). The settlements result from allegations ofconflicts of interest at brokerage houses where analysts recommendedstocks due to improper influence from their investment banking colleagues.Deutche Bank Securities, Inc. will pay $287,500 and Thomas Weisel Partners LLC will pay $50,000 in fines.Commissioner Crowley made the announcement following investigations of thetwo firms by the California Department of Corporations, the U.S.Securities and Exchange Commission, NASD, Inc., and the New York StockExchange. The settlements are related to the April 2003 Global Settlementthat ten other investment banks reached with the state, federal andindustry regulators.Deutsche Bank will pay a total of $87.5 million: $25 million indisgorgement, $25 million as a penalty for various conflicts ofinterest, $25 million to fund independent research, $5 million to fund andpromote investor education, and $7.5 million for failing to promptlyproduce e-mail and thereby delaying by over a year the investigation as toDeutsche Bank. Thomas Weisel Partners will pay a total of $12.5 million:$5 million in disgorgement, $5 million as a penalty for various conflictsof interest, and $2.5 million to fund independent research.The investigations of Deutsche Bank and Thomas Weisel Partners,together with the 2003 Global Settlement, are part of a comprehensiveregulatory effort to reform the relationship between investment bankingand research and to manage appropriately conflicts of interest.Commissioner Crowley said, “Today’s settlements represent a significantstep in our continuing efforts to ensure that investors are treated fairlyand provided with objective research.”Under the terms of the settlement, Deutsche Bank is also required todistribute $2.5 million to the Investor Protection Trust (IPT), which willuse the money to fund investor education initiatives on the state andnational levels. The IPT is an established charitable organization withexperience handling settlement funds and a history of investor educationsuccesses.last_img