Broker-Dealer Is Fined Over Lavish Conferences
NASD has sanctioned Wells Investment Securities, a sponsor of real estate investment trusts, for rewarding representatives of broker-dealers who sell shares of their REITs with lavish entertainment and trips.
NASD, formerly known as the National Assn. of Securities Dealers, censured Norcross, Ga.-based Wells Investment and its president, Leo Wells, and fined them a total of $150,000. NASD also suspended Leo Wells from acting in a principal capacity for one year. Consequently, Wells must step down as president of Wells Investment, which acts as the broker-dealer for Wells Real Estate Funds Inc.
In a statement Monday, NASD cited conferences held by Wells Investment in 2001 and 2002 that were touted as being “strictly educational” but “actually constituted lavish affairs that did not meet the standards of NASD rules.”
In settling the dispute, Wells neither admitted nor denied the allegations.