NASD Penalizes 9 Brokers in Fraud Scheme

The National Assn. of Securities Dealers fined nine New York-area brokers as much as $50,000 apiece and permanently barred them from the securities industry for paying impostors to take their licensing exams. The brokers, all from penny stock firms, were also ordered to refund illegal profits, which amounted to $440,000 in one case. The charges are the second wave connected to the most widespread brokerage test-taking fraud in recent years. In August, 10 brokers and two brokerage employees were fined and permanently barred by the NASD for paying stand-ins to take the Series 7 licensing exams. The broad investigation by the NASD is continuing.