Strong Capital Management and majority owner Richard S. Strong will pay a total of $175 million, and Mr. Strong will be barred from the investment management industry for life, in a settlement announced today with the SEC and the attorneys general of New York and Wisconsin over market-timing allegations. Mr. Strong and the firm will pay $140 million in civil penalties and restitution, and Strong Capital will cut its fees to shareholders over five years by 6%, or a total of $35 million.
The settlement calls for Strong Capital to pay $40 million in restitution and $40 million in civil penalties, while Mr. Strong will pay $30 million in restitution and $30 million in civil penalties.
Also, Thomas A. Hooker, Strong Capital's former compliance officer, and Anthony J. D'Amato, an executive vice president who is accused of approving market-timing arrangements with hedge fund Canary Capital Partners, are both barred for life from the investment management industry.
"These settlement agreements allow us to move forward and concentrate all of our energies on meeting the needs of our clients and delivering high-quality investment performance," Kenneth J. Wessels, Strong chairman and CEO, said in a news release.