David Lerner Associates Fined $2.3M; Head Trader Suspended
WASHINGTON — A Financial Industry Regulatory Authority hearing panel has fined Syosset, N.Y.-based David Lerner Associates Inc. $2.3 million and suspended head trader William Mason for six months with a $200,000 fine for charging excessive markups on municipal bond and collateralized mortgage obligation transactions over a two-year period.
The panel also ordered the firm to pay more than $1.4 million, plus interest, in restitution to affected customers, according to a FINRA release issued Wednesday.
Between 2005 and 2007, David Lerner and Mason charged excessive markups on more than 1,500 muni-bond transactions and 1,700 collateralized mortage obligations transactions, the hearing panel found.
The markups caused retail customers to pay unfairly high prices and receive lower yields, FINRA said.