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Firm Pays Penalty For Not Keeping E-Mail Communication Records Long Enough
POSTED: 1:19 p.m. CST December 3, 2002
U.S. Bancorp Piper Jaffray has agreed to pay a $1.65 million fine in a record-keeping case related to how long it kept e-mail communications.
The Minneapolis-based brokerage house was one of five firms who received the fine, while not admitting or denying the allegations in accepting the ruling.
The firms also agreed to review their procedures to ensure compliance with record-keeping statutes and rules, the U.S. Securities and Exchange Commission announced in a press release Tuesday.
The investigation was run jointly by the SEC, the New York Stock Exchange and the National Association of Securities Dealers.
The investigation into how long firms hold onto such e-mail records comes after regulators and state prosecutors uncovered embarrassing e-mails showing analysts publicly hyping a stock they
privately disparaged, allegedly to win lucrative investment banking business.
In its release, the SEC said that the fines were levied for "failing to preserve for a period of three years, and/or preserve in an accessible place for two years, electronic communications relating to the business of the firm, including interoffice memoranda and communications."
Other firms agreeing to the fine were Goldman Sachs, Salomon Smith Barney, Morgan Stanley, and Deutsche Bank Securities.
Merrill Lynch recently paid $100 million in fines to settle an investigation by New York state after its attorney general's office found incriminating e-mails by Merrill's former Internet analyst Henry Blodget. Citigroup and its Salomon Smith Barney investment banking group also came under fire last month for a situation involving its former telecommunications analyst Jack Grubman.
The Minneapolis-based brokerage house was one of five firms who received the fine, while not admitting or denying the allegations in accepting the ruling.
The firms also agreed to review their procedures to ensure compliance with record-keeping statutes and rules, the U.S. Securities and Exchange Commission announced in a press release Tuesday.
The investigation was run jointly by the SEC, the New York Stock Exchange and the National Association of Securities Dealers.
The investigation into how long firms hold onto such e-mail records comes after regulators and state prosecutors uncovered embarrassing e-mails showing analysts publicly hyping a stock they
privately disparaged, allegedly to win lucrative investment banking business.
In its release, the SEC said that the fines were levied for "failing to preserve for a period of three years, and/or preserve in an accessible place for two years, electronic communications relating to the business of the firm, including interoffice memoranda and communications."
Other firms agreeing to the fine were Goldman Sachs, Salomon Smith Barney, Morgan Stanley, and Deutsche Bank Securities.
Merrill Lynch recently paid $100 million in fines to settle an investigation by New York state after its attorney general's office found incriminating e-mails by Merrill's former Internet analyst Henry Blodget. Citigroup and its Salomon Smith Barney investment banking group also came under fire last month for a situation involving its former telecommunications analyst Jack Grubman.
Copyright 2002 by Channel 4000. The Associated Press contributed to this report. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
