WASHINGTON -- Flexing their muscles, Securities and Exchange Commission officials from around the nation told a group of lawyers here that while cooperation with regulators is essential, the bar has been raised in terms of penalties and no firm will avoid getting its medicine.

The nation's top securities regulator sent an unmistakable message to the $7.4 trillion mutual fund industry that cooperation, or lack thereof, will be taken into account when doling out penalties, but the sector's expectations should not be based on historical fines. Times and circumstances have changed.

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