SEC Fines, Censures Scudder Kemper in Unauthorized Derivatives Trading

Updated from 3:24 p.m. EST

Scudder Kemper Investments, the prominent New York-based money management firm, was censured and fined a quarter of a million dollars Wednesday by the Securities and Exchange Commission in connection with unauthorized derivatives trading that resulted in losses to investors of more than $16 million.

The SEC also sanctioned two former employees, Gary Paul Johnson, 50, and Michael T. Sullivan III, 37. Johnson, the former head of derivatives trading at Scudder's Boston office, agreed to a one-year suspension and a $10,000 fine. Sullivan, formerly a trader under Johnson's supervision, agreed to be barred from the industry for five years. ...