The SEC has authorized staff to bring an enforcement action against the brokerage that could result in repayment of ill-gotten gains, civil monetary penalties or other sanctions. Bear Stearns has stated that it believes it has a strong defense against potential claims and plans on continuing talks with the SEC, but the company has declined to comment further.
In February, the SEC fingered brokerage Brean Murray $150,000 for improper trading of mutual funds for hedge funds. Although the SEC at the time said that Brean's trades went through an unnamed clearing firm, Bloomberg News at the time reported that Bear Stearns violated federal investor protection laws by helping brokers engage in late trading of funds and that a suit filed in a
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.