Metropolitan Investment Securities of Washington Sanctioned for Abusing Customers

NASD has sanctioned the brokerage firm $500,000, ordered it to make restitution to customers totaling more than $2.8 million, and ordered it to maintain a special reserve escrow account for investors' claims at a level of $1 million for a five-year period.

The NASD found that the firm engaged in abusive sales practices and had inadequate supervisory procedures. Metropolitan Investment Securities sold debentures, investment certificates and preferred stock issued by two affiliated companies. The firm raised millions from investors through the use of unfair and unbalanced sales presentations, including downplaying the risk of loss and giving the impression that the investments were safe.

Source: NASD News Release, December 11, 2003