Today, the SEC announced that it has settled a securities fraud case against Bear Stearns & Co., Inc. (Bear Stearns). The SEC charged Bear Stearns with securities fraud for facilitating unlawful late trading and deceptive market timing of mutual funds by its customers and customers of its introducing brokers.
Pursuant to the settlement agreement, Bear Stearns will pay $160 million in disgorgement and $90 million in civil penalties for a total of $250 million. The money will go to the affected mutual funds and their shareholders. Bear Stearns also agreed to undertake significant reforms.
NYSE also penalized Bear Stearns, censuring and fining the company. However, the fine imposed by the NYSE will be satisfied by the payment of the $250 million required by the SEC. To learn more, read the SEC's Order Instituting Administrative and Cease-And-Desist Proceedings.
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