The NASD, the private sector regulator of the U.S securities industry, has fined and suspended a former research analyst at Banc of America Securities LLC (BAS) for issuing research reports with ratings, target prices and substantive discussions that were contrary to his personal opinions.

It has also taken action against three other firms and individuals for violations involving misleading research reports and press releases

NASD found that Andrew Hamerling, of BAS, issued six research reports regarding four issuers – SBC Communications, Inc., Williams Communications Group, TyCom, Ltd., and Qwest Communications International Inc. that violated NASD rules.

Before issuing a September 2001 SBC report, Hamerling concluded that the SBC’s earnings did not adequately reflect the company’s operating results, and prepared a draft report with that analysis. NASD found that Hamerling did not publish this negative research report because he was concerned that SBC would not attend an upcoming Banc of America Securities conference and that SBC would deny him access to information in the future. NASD found that the published report failed to disclose negative facts about the company as well as Hamerling’s actual views.

NASD also found that Hamerling published buy ratings for SBC with a US$51 target price, while he believed the stock price would decrease and, in emails, recommended that it be shorted.

It also determined that Hamerling gave advance notice of his stock ratings, price targets and substantive research to representatives of issuers that he followed. This practice furnished potentially market-sensitive information prior to public release and violated NASD’s just and equitable principles rule as well as BAS’ own internal policies.

NASD imposed a 9-month suspension and a US$125,000 fine payable upon his reassociation with any NASD-registered firm.

The regulalor has also taken action against three other firms and individuals for violations involving misleading research reports and press releases.

NASD censured and fined Axiom Capital Management Inc. and three employees an aggregate of US$85,000 for publishing misleading research reports in 2001 and 2002.

It censured and fined Banyan Capital Markets LLC, its owner and president, Barry Goldberg, and a research analyst, Louis Fischler, an aggregate of US$60,000 in connection with the publication of a research report.

Tejas Securities Group Inc. was censured and fined US$35,000 for publishing misleading statements on its Web site and posting press releases and summaries of research reports that did not disclose risks associated with the securities discussed.

All four cases were settled, and the respondents did not admit nor deny the allegations, but consented to the entry of findings by NASD.