Banner: Maryland Attorney General J. Joseph Curran, Jr.
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For Immediate Release
August 26, 2004
Media Contact:
Kevin Enright 410-576-6357

Settlement Requires Brokerage Houses to pay Fines, Fund Independent Research and Investor Education

Attorney General J. Joseph Curran, Jr. announced today that under the terms of a settlement between securities regulators and Deutsche Bank Securities, Inc. and Thomas Weisel Partners LLC, Maryland stands to receive $550,935 upon final acceptance of the terms of the agreement. The settlements result from allegations of conflicts of interest at brokerage houses where analysts recommended stocks due to improper influence from their investment banking colleagues.

Attorney General Curran made the announcement following investigations of the two firms by the California Department of Corporations, the U.S. Securities and Exchange Commission, NASD, Inc. and the New York Stock Exchanges. Along with California, Curran's Securities Division and that of the District of Columbia negotiated the Deutsche Bank settlement. These cases are related to the April 2003 Global Settlement that ten other investment banks reached with the state, federal and industry regulators.

Deutsche Bank will pay a total of $87.5 million: $25 million in disgorgement, $25 million as a penalty for various conflicts of interest, $25 million to fund independent research, $5 million to fund and promote investor education, and $7.5 million for failing to promptly produce e-mail and thereby delaying, by over a year, the investigation. Thomas Weisel Partners will pay a total of $12.5 million: $5 million in disgorgement, $5 million as a penalty for various conflicts of interest, and $2.5 million to fund independent research

"The reforms agreed upon in this settlement will provide stronger protections for investors and will ensure that investors are treated fairly, " Attorney General Curran said. "These settlements, together with the 2003 Global Settlement, are part of a comprehensive regulatory effort to reform the relationship between investment management and research and to appropriately manage conflicts of interest."

Under the terms of the settlement the firms also are required to distribute $2.5 million to the Investor Protection Trust. The money will be used to fund investor education initiatives on the state and national levels. The IPT is an established charitable organization with experience handling settlement funds and a history of investor education successes.



Attorney General of Maryland 1 (888) 743-0023 toll-free / TDD: (410) 576-6372
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