Securities: Bank of America Securities to Pay $26 Million

The Bank of America's securities business has agreed to pay $26 million to settle federal regulators' charges that they published fraudulent research reports on companies and that they did not prevent leaks of reports that could be used for improper trading. The settlement was the latest in the Securities and Exchange Commission's efforts to crackdown on conflicts of interest at Wall Street investment firms. A statement from Bank of America said that "we believe it is in the best interest of the corporation and our shareholders to settle this matter at this time."

The settlement comes after a censure and a $10 million fine that the SEC ordered Bank of America to pay three years ago for not producing relevant documents and for hindering the SEC's investigation. The SEC says that between January 1999 to December 2001, Bank of America had a "breakdown" in its internal controls designed to prevent the misuse of company research reports. The SEC says that Bank of America Securities also failed to prevent conflicts of interest "that compromised the independence and integrity of its analysts."