The NASD announced Wednesday it has fined American General Securities, a unit of American International Group, more than $1.1 million for accepting directed-brokerage payments to promote certain mutual funds, in violation of the NASD's anti-reciprocal rule.

"NASD remains committed to ensuring that firms comply with our rules in connection with the marketing and sale of mutual fund shares," said James Shorris, NASD executive vice president and head of enforcement. "The anti-reciprocal rule is designed to ensure that firms recommend mutual funds on their merits and not because of the receipt of brokerage commissions, which are assets of the mutual fund shareholders and should not be used for marketing purposes."

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.