NASD Fines American Funds Distributors $5 Million

Law360, New York (August 30, 2006, 12:00 AM EDT) -- An NASD panel censured and fined American Funds Distributors Inc. at a hearing on Wednesday, saying the company violated NASD’s Anti-Reciprocal Rule by giving brokerage commissions to the securities firms that sold the most American Funds mutual funds.

The panel fined American Funds $5 million for the breaches, which allegedly took place from 2001 to 2003.

The Anti-Reciprocal Rule is meant to abolish “reciprocal business practices in connection with the distribution of mutual fund shares,” said the panel. It was created to protect individual investors from...
To view the full article, register now.

Law360 UK

UK Financial Services

Read Our Latest UK Legal News & Analysis

Financial Services Law360 UK and Insurance Law360 UK provide breaking news and in-depth analysis on U.K. and European Union regulation, enforcement, legislation, and litigation involving banks, investment firms, insurers, and more.