Ex-Fidelity traders fined $1M for taking swag

Dec 11, 2008 @ 2:34 pm

By Sara Hansard

Eight former employees of Fidelity Investments will pay more than $1 million in total for improperly receiving travel, entertainment and gifts paid by outside brokers courting business from the giant Boston-based mutual fund company, the SEC announced today.

The Securities and Exchange Commission instituted administrative proceedings in March against 10 former Fidelity employees, including the former vice president and head of the trading desk, Scott E. DeSano.

The orders issued today found that Mr. DeSano and former Fidelity equity traders Timothy J. Burnieika, David K. Donovan, Edward S. Driscoll, Jeffrey D. Harris, Christopher J. Horan, Steven P. Pascucci and Kirk C. Smith violated securities laws by accepting prohibited compensation from brokers.

The perks included private jet trips, lodging and premium sports tickets.

Furthermore, the SEC found that Mr. DeSano was a cause of Fidelity’s not getting best execution of trades for its clients. That was not disclosed, and Mr. DeSano failed to supervise the traders, the SEC wrote in a statement.

“Employees of money managers must keep the clients’ interest paramount and avoid putting their personal interests at odds with those of the investors they serve,” SEC Boston regional office director David Bergers said in the statement.


What do you think?

View comments

Recommended for you

Featured video


Compensation changes at broker-dealers

Senior columnist Bruce Kelly and deputy editor Bob Hordt discuss pay changes underway at firms such as LPL and Raymond James, in some cases related to the DOL fiduciary rule.

Latest news & opinion

DOL fiduciary rule opponents want to push implementation back until 2019

ICI, Chamber of Commerce among groups asking for delay, while Democratic lawmakers call on DOL to keep to its earlier planned schedule of Jan. 1, 2018.

Take 5: Vanguard's new CIO Greg Davis talks bonds, stocks and costs

Having just stepped into the role, this veteran of the firm now oversees $3.8 trillion in assets in more than 300 mutual funds and exchange-traded funds.

Tech companies deploy behavioral finance tools for advisers

They seek to turn knowing more about clients into growing more revenue.

Retirement planning for women

Longer lifespans and lower savings require creative income strategies.

Sean Spicer resigns as press secretary after Anthony Scaramucci is appointed communications director

Scaramucci is known as an ardent foe of the DOL fiduciary rule, having said during the campaign that Trump would repeal it .


Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print