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Securities regulators may be close to filing civil charges against Jack Grubman, the fallen telecom analyst, and his former employer,


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Salomon Smith Barney, according to a report in

The Wall Street Journal


The newspaper says unnamed sources have told it that the regulatory arm of the National Association of Securities Dealers could announce the filing of charges as soon as Monday. The charges would stem from a possible conflict between Salomon's investment banking work for

Winstar Communications

and Grubman's ebullient coverage of the now-bankrupt telecom.

A Salomon spokeswoman, responding the Journal story, said the bank is "cooperating with the various investigations."

The filing of charges would not necessarily be a surprise. Back in June, the NASD notified Grubman that its investigators had made a "preliminary determination" of a violation of federal securities laws or regulations in his coverage of Winstar.

Securities lawyers say that when the NASD makes such a preliminary determination, the filing of charges against an individual or firm is all but a certainty.

The bigger issue for Citigroup is just how much of a fine it will be ordered to pay and whether the NASD action adds fuel to an inquiry of Salomon that's being conducted by New York Attorney General Eliot Spitzer.

An NASD action also could provide ammunition to the growing list of lawyers who have filed arbitration claims and class-action lawsuits against Grubman and Salomon over the firm's overly bullish coverage of the telecom industry. At last count, more than three dozen legal actions were pending against Grubman and the investment bank.