The Securities and Exchange Commission has filed an order against a top advisor at Fidelity Investments, after a four-year investigation into the inappropriate use of gifts and the entertainment of prospective clients.
Peter Lynch, vice chairman and director of Fidelity parent company FMR, is accused of using traders on Fidelitys equity desk to score tickets to expensive and often sold-out events, including a U2 rock concert and the Ryder Cup tournament.
The SEC alleges Lynch took 61 tickets for 12 different events at a cost of $15,948. Lynch agreed to pay the amount, plus $4,183 in interest, without admitting or denying wrongdoing, and agreed to cease and desist from such conduct in the future.
Since retiring from investment management over 17 years ago, I have not placed any trades on behalf of Fidelity with any brokerage firm, Lynch said in a statement. In asking the Fidelity equity trading desk for occasional help locating tickets, I never intended to do anything inappropriate, and I regret having made those requests.
Fidelity said it will pay an $8 million civil penalty and that Lynchs behavior is not indicative of the ethical standard of the company.
Its important to note that the order makes no note of financial harm done to shareholders, said Fidelity spokeswoman Anne Crowley in an interview with Dow Jones News Service.
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