In Brief: FBR Settles Insider Trading Suit for $4M

December 21, 2006, 2:00 a.m. EST 1 Min Read

Friedman, Billings, Ramsey Group Inc. has agreed to settle a civil lawsuit alleging insider trading in connection with a 2001 private offering for CompuDyne Corp., regulators announced Wednesday.

Emanuel Friedman, FBR's former co-chairman and co-chief executive, and Nicholas Nichols, its former compliance director, also settled, without admitting or denying the allegation by the Securities and Exchange Commission and NASD.

The SEC said that FBR will pay $3.75 million in fines and interest and return the allegedly ill-gotten gains. Mr. Friedman is to pay a $754,046 fine, and Mr. Nichols $60,000, it said.

According to the SEC's complaint filed in U.S. District Court in Washington, the Virginia investment banking company engaged in insider trading by selling short the shares of CompuDyne while it possessed nonpublic information on the company as the placement agent for its private investment in public equity.

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