Report: SEC Considering Civil Action Against Prudential Executives
NEW YORK (AP) _ Federal securities regulators have recommended civil actions against at least five former and current Prudential Securities executives, The New York Times reported Friday.
The five, including three former top retail executives at the company, were informed by Securities and Exchange Commission lawyers that the agency’s enforcement division is calling for charges over alleged failure to ensure that brokers under their supervision complied with federal securities regulations, the Times said, citing unnamed people familiar with the inquiry.
As many as 12 former and current Prudential executives are under investigation, according to others involved in the case, although none are members of the firm’s current senior management, the Times reported.
The three retail executives are Richard Sichenzio, the head of retail business from 1988 to 1991, Sichenzio’s deputy Joseph Haick, and Robert J. Sherman, who headed the division from 1982 to 1988. The firm was known as Prudential-Bache during the period in which the three led the operation.
The SEC complaints, if brought, would be the first regulatory actions against individuals stemming from government charges of widespread fraud at Prudential.
Prudential last week settled the fraud charges, agreeing to pay $41 million in fines and pay $330 million into a fund to compensate investors defrauded in limited partnership deals during the 1980s.