Davenport & Co., a Richmond, Va.-based brokerage firm, market timed variable annuity sub-accounts on behalf of two of its hedge fund clients, the National Association of Securities Dealers charged last week, ordering Davenport to pay $450,000 for improper trading.

The NASD fine includes an order for Davenport to pay $228,000 in restitution to variable annuity shareholders who suffered as a result of the firm's rapid-fire trading. The fine also cites Davenport for failing to establish an adequate supervisory system and its inability to document a policy aimed at preventing late trading of mutual funds.

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