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Bank of America's Hamerling Settles

The former telecom analyst is fined and suspended for his misleading research.

The NASD has quietly suspended and fined former

Bank of America

(BAC) - Get Bank of America Corp Report

telecom analyst Andrew Hamerling for allegedly issuing research reports with "exaggerated and unwarranted claims."

The brokerage industry's largest self-regulatory organization also alleged that Hamerling provided some of the companies he covered with advance notice of forthcoming research reports and rating changes.

In October,

TheStreet.com

reported that Hamerling and the NASD were

close to reaching a settlement in the matter.

The parties agreed to a deal on Nov. 12 that only recently came to light. A broad outline of the allegations against Hamerling is included on his broker registration statement. But the industry document doesn't state which stocks Hamerling issued misleading reports on.

In the settlement, Hamerling agreed to a nine-month suspension from the brokerage industry and to pay $125,000 if he accepts a job with another Wall Street brokerage. As is customary in securities regulatory settlements, Hamerling neither admitted nor denied the NASD allegations.

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Hamerling, who was fired by Bank of America in January 2002, currently is an analyst with

Galleon Management

, a New York hedge fund with more than $2 billion in assets.

The temporary suspension would not affect his employment at Galleon, or any other hedge fund, because they are not registered as brokerage firms. He also would not have to pay the fine as long as his work on Wall Street is limited to the hedge fund community.

Hamerling and his lawyer, Jeff Kaplan, both declined to comment.

The NASD action against Hamerling is the first time regulators have alleged that a BofA stock analyst issued a misleading research. The North Carolina-based bank, which is in the process of acquiring

FleetBoston Financial

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, was not a party to the $1.4 billion tainted-research settlement that securities regulators signed this year with 10 Wall Street firms.

It had been widely believed that BofA had emerged unscathed from last year's investigations into conflicts of interest among stock analysts. But people familiar with the Hamerling investigation said it stems from a broader regulatory inquiry into some BofA's research and stock trading practices.

Shirley Norton, a bank spokeswoman, said the bank "terminated" Hamerling on Jan. 23, 2002 after finding he had violated a "policy on internal and external email communications." She said the bank informed regulators of its actions soon after Hamerling's dismissal.