ETrade Securities, one of the largest online brokerage firms, has been fined $90,000 in a settlement with a self-policing brokers’ group for allegedly violating advertising rules by making misleading claims.
ETrade neither admitted to nor denied the allegations by NASD Regulation, according to news reports. NASD Regulation, the disciplinary arm of the National Association of Securities Dealers, said ETrade violated the group’s advertising rules in an August 1999 newspaper ad for its technology index mutual fund and in two direct-mail marketing campaigns in 1999 and 2000.
The direct-mail ads were sent to 9.8 million prospective investors.
The group’s rules prohibit advertising that makes exaggerated claims for returns on investment, or is misleading or deceptive.
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