WASHINGTON -- Institutional Shareholder Services settled civil charges by U.S. regulators that an employee of the prominent proxy advisory firm shared nonpublic voting data in exchange for meals and concert tickets.
In settling, ISS neither admitted nor denied the SEC allegations that it violated financial adviser rules designed to prevent misuse of material non-public customer information.
Mutual funds, pension organizations and other institutional investors hire firms like ISS to advise them on how to vote on important corporate issue such as executive compensation and board appointments.
The SEC alleged that from 2007 through 2009, an ISS employee provided a proxy solicitor, a firm that rounds up shareholder votes, with nonpublic information revealing how more than 100 ISS clients were voting their proxy ballots.
Cheryl Gustitus, a spokeswoman for ISS, said the firm took "swift action of its own" and also cooperated with the SEC.
"The confidentiality of our clients' information is essential," she said. "We now consider this matter closed."
The case marked the first time the SEC has sued a proxy advisory firm, according to an agency spokesman.
Business groups such as the U.S. Chamber of Commerce have long complained about the influence that proxy advisory firms like ISS can wield in corporate elections.
Most recently, ISS urged JPMorgan Chase (JPM) shareholders to vote against the re-election of three board members, saying they failed to oversee the bank's risk-taking that led to $6.2 billion in losses from bad credit known as the "London Whale" trades.
Those directors won reelection earlier this week, but they received less than 60 percent of the vote.
The SEC alleged that the ISS employee who revealed the voting intentions of clients received $11,500 worth of sporting and concert tickets, as well as $20,000 in meals.
"Based on emails between the ISS employee and the proxy solicitor, the ISS employee provided the information to the proxy solicitor as a quid pro quo for the tickets and meals he received," the SEC said.
The SEC didn't provide the name of the ISS employee or the proxy solicitor employee.
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Satellite radio has never been more popular. There are now 23.9 million subscribers after the parent company of Sirius and XM closed out 2012 with 2 million more accounts than it had when the year began.
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A few years ago, Nokia was the undisputed top dog in mobile phone handsets. The Finnish company was a global juggernaut at a time when consumers were swapping beepers -- remember those? -- for wireless phones.
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A big draw for investors in Frontier Communications is its meaty dividend payout. Even after slashing its quarterly rate from $0.1875 a share to $0.10 a share last year, the stock's still yielding 10 percent. The large dividend is significant, since shorts actually have to cover that when it gets paid out.
Analysts see revenue and profitability continuing to decline here, and pessimists are holding out for more dividend cuts in the future.
The old "Intel inside" ads came out at a time when PC sales were booming. Manufacturers were hopping on Intel microprocessors to power desktops and laptops, only turning to smaller rival Advanced Micro Devices (AMD) when they wanted to show Intel that they weren't entirely dependent on the chip giant.
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The poster child for the "too big to fail" banking giants is starting to bounce back.
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