Scott DeSano, Fidelity Investments' high-profile head of trading, has been reassigned to another post within the firm, according to a report posted to The Wall Street Journal's online edition Monday afternoon. The report cited "people familiar with the matter."
The move comes amid a broad regulatory probe into gift giving and entertainment on Wall Street. Fidelity and DeSano have been targets of this investigation spearheaded by the NASD and the Securities and Exchange Commission.
DeSano was one of 14 Fidelity employees disciplined late last year for failing to supervise some of his employees, some of whom accepted lavish gifts from Wall Street firms, including trips to expense sporting events like Wimbledon and the Super Bowl. According to the Journal, the disciplinary action included a fine of roughly $50,000 among other things.
It isn't known whether this latest move is connected to the gift probe, but the Journal reported that his new position isn't on the trading desk, again citing its source familiar with the matter.
DeSano is widely regarded as one of the most powerful traders on Wall Street. He became Fidelity's head of stock trading more than eight years ago and overhauled the company's trading operations, saving hundreds of millions of dollars a year for fund shareholders and also squeezing profits from the Wall Street brokers who buy and sell stocks for the company's mutual funds, the Journal said.
DeSano was instrumental in bringing Fidelity's trading costs-once in line with the industry average-to half the industry average, as documented by research firm Abel/Noser.