NASD Nails Daytrading Firms as Senate Hearings Open

Adding to the noise surrounding Senate subcommittee hearings on daytrading, the regulatory arm of the National Association of Securities Dealers announced disciplinary actions Thursday against six companies and seven individuals it says violated securities rules involving daytrading.

Its activities in the area, however, likely won't end with this week's Washington hoopla. Barry Goldsmith, the head of enforcement at NASD Regulation, says the NASD investigation of daytrading is continuing. "These are significant cases," he says. "We have other ongoing investigations in the area."

This time around, though, the infractions included misleading advertising, allowing customers to continue trading after they failed to meet margin requirements, and misuse of investments to provide loans to daytraders, according to the NASD. ...