The NASD announced Thursday that it has fined five brokerage firms $625,000 for failure to have the supervisory systems in place to detect and prevent late trading. The five are D.A. Davidson & Co., TD Waterhouse Investor Services, Stifel Nicolaus & Co., National Planning Corp. and SII Investments, Inc. Each of these firms processed trades after the 4 p.m. close of the market, the NASD said.

"To help ensure that illegal late trading does not occur, firms must implement systems to guarantee that all mutual fund orders processed after the close of the market were received during normal trading hours," said NASD Vice Chairman Mary Schapiro. "NASD will be vigilant about sanctioning firms for failing to have adequate supervisory systems in place designed to prevent manipulative late trading, regardless of whether such trading, in fact, occurs."

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