Wall Street regulator fines Stifel, Century over risky ETF sales

WASHINGTON Thu Jan 9, 2014 10:14am EST

WASHINGTON Jan 9 (Reuters) - Two brokerage units of Stifel Financial Corp will pay more than $1 million to settle civil charges alleging they sold risky, ill-suited exchange-traded fund products to certain customers, Wall Street's self-funded regulator said Thursday.

The Financial Industry Regulatory Authority said Stifel, Nicolaus & Co Inc and Century Securities Associates Inc will pay fines of $550,000 and restitution of $475,000 to 65 harmed customers without admitting or denying the charges.

The risky products at the heart of the case - leveraged and inverse exchange-traded funds - have been in regulators' sights now for several years.

Both FINRA and the Securities and Exchange Commission have been looking more closely into these funds to see if they are adequately transparent for retail investors and are not helping to fuel market volatility.

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