NYSE Fines Smith Barney Shearson : Wall Street: Exchange says it repeatedly failed to report complaints against its brokers. The firm admits no guilt.

The New York Stock Exchange disclosed Wednesday that it has charged Smith Barney Shearson, the nation’s second-largest brokerage, with repeatedly failing to notify regulators of customer complaints and disciplinary proceedings against its brokers.

In at least one instance, such a lapse prevented the NYSE from launching its own investigation of a broker, the exchange alleged. The lack of timely reporting meant that customers would not have been able to get accurate information about the disciplinary records of the 44 brokers involved, it said.

The charges and a settlement with Smith Barney were signed Jan. 18 but were not made public until Wednesday. Smith Barney neither admitted nor denied the allegations but agreed to a $50,000 fine and a censure. It also agreed to overhaul its procedures.

In 61 instances in 1992 and 1993, the exchange said, Smith Barney violated rules requiring it to promptly report customer complaints, arbitration cases, disciplinary proceedings, judgments and settlements involving its brokers to the NYSE and the National Assn. of Securities Dealers.

Even after receiving a warning letter from the Big Board in September, 1992, Smith Barney continued to be months late in making the required filings, the exchange charged.

Smith Barney spokesman Robert Connor said the firm’s reporting to the NYSE “apparently was a little scattered in how it was handled.” But, he added, “today we’re operating in accordance with the procedures that are required for accurate reporting of this information.” The firm is a subsidiary of Travelers Inc.

One reason for the reporting requirements is to alert the stock exchanges to possible serious wrongdoing so they can launch investigations. Information on complaints and actions against brokers must also be listed on a termination form whenever a broker is fired or resigns.

The forms allow prospective employers to evaluate brokers’ disciplinary records. The information also goes into a central computer system operated by the National Assn. of Securities Dealers through which investors can check the records of their brokers.

The NYSE charges did not disclose the names of brokers and gave no details of the matters that Smith Barney allegedly failed to report.

Separately, Securities and Exchange Commission officials have said they are likely to release within a month the results of an investigation into major Wall Street firms that hire and retain brokers with long records of complaints and judgments against them. The investigation, known as the Large Firm Project, has been under way for well over a year.