The National Association of Securities Dealers has sanctioned Ramy M. Shaalan, a former research analyst at Rydex Funds, with embezzled $96,000 through a scheme he concocted while at Rydex. Shaalan, who did not admit or deny wrongdoing, was banned from working in the securities industry.

NASD said Shaalan set up a bank account under the name of a fictitious entity of which he was the purported owner. The entity's name was strikingly similar to a client company with which his firm, Rydex, did business. Because Shaalan had access to the client company's invoices, he used them to create fake invoice templates for the fictitious company and billed Rydex for services the fictitious company purportedly provided the firm.

Furthermore, according to the findings, Shaalan requested checks to pay for the fake invoices to be submitted to him to be given to the fictitious company. Shaalan endorsed the checks and used the fictitious company's bank account to deposit the money, which he ultimately took in for personal use.

Dawn Kahler, a spokeswoman for Rydex, said the firm first came to know of Shaalan's misappropriation of funds in July 2004 and promptly contacted regulatory authorities to alert them of the situation. She said Shaalan was terminated immediately. "This was not related to shareholder accounts," Kahler added.

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