The Securities and Exchange Commission has upheld an administrative judge's ruling that a mutual fund trader must pay more than $200,000 in penalties for accepting gifts from broker-dealers to steer trades their way. The regulator didn't buy the trader's excuse that the mutual funds weren't harmed.
The SEC said that Robert Burns, a former equity trader at FMR Co., violated the Investment Company Act of 1940 by accepting the compensation from brokerage firms. Burns had to disgorge about $141,000 and interest of $67,205. He must also pay a civil penalty of $40,000.
FMR is a subsidiary of Fidelity Management and Research Company.
Burns, who was dismissed by FMR in December 2004, sent orders to more than 50 brokerage firms. Of those 50, about 10 gave him 39 gifts such as wine, travel and tickets to concerts, sporting events and theater productions. The gifts, according to the SEC, included tickets to the Wimbledon tennis finals in 2002, 2003 and 2004; a case of 1993 Château Pétrus Pomerol wine in December 2003; tickets to see Prince, the Rolling Stones, Bruce Springsteen, Madonna, the Boston Celtics, the Boston Red Sox and the New England Patriots.
Volatility to Continue For Years: Towers Watson
Market volatility and an uneven path for the economic recovery are set to continue for years, according to Towers Watson. What's more, all asset classes will face higher-than-average volatility, Towers Watson said.
"The events of the past several days are consistent with the outlook we had prior to these global events-that we expect a bumpy path to recovery, with pressures from the debt overhang materializing in places that are hard to predict," said Carl Hess, global head of investment at Towers Watson.
Towers Watson looked at three recent events and their impact on the global markets.
First, fear of a U.S. recession and a sharp slowdown in global growth. As developed nations are deep in debt, Towers Watson expects "worse outcomes are more likely than very good outcomes over the medium term."
Second, as to the U.S. sovereign downgrade, the company expects more selling of equities in the next few days, but not of bonds. Towers Watson does expect, however, a modest increase in U.S. borrowing costs and for foreign investors to diversify away from U.S. dollar assets.
Third, as far as the Euro-zone crisis is concerned, Towers Watson sees the problems of Greece Ireland and Portugal spreading to Spain and Italy.
DST Systems Reviews trategic Options
After insisting it wants to stay independent, DST Systems has come close to confirming it is on the block.
DST has hired Bank of America Merrill Lynch and law firm Skadden, Arps, Slate, Meagher & Flom LLP to advise its board on its future. "The board of directors of DST is continuing its longstanding practice of engaging in an ongoing review of the company's business plan, assets and investment portfolio," DST said in a statement.
