Charles Schwab Corp. on Tuesday said it had agreed to pay a fine of $350,000 to settle SEC enforcement proceedings related to the processing of mutual fund orders.

Charles Schwab Corp. on Tuesday said it had agreed to pay a fine of $350,000 to settle SEC enforcement proceedings related to the processing of mutual fund orders.

Schwab has agreed to a cease and desist order without admitting or denying any wrongdoing as part of the settlement with the U.S. Securities and Exchange Commission.

The SEC contended that Schwab had allowed investment adviser customers to place substitute mutual fund orders after the 4:00 p.m. Eastern time market close, creating the risk that such customers could unfairly capitalize on late-breaking news at the expense of other mutual fund investors.

The largest U.S. discount brokerage said in its statement that the SEC found no evidence of any scheme to exploit Schwab’s order entry process or circumvent its controls. Nor did the SEC find any instances in which Schwab customers or employees had placed trades based on the use of post-close market information.

The San Francisco-based company said an internal review that began last fall had found instances in which Schwab employees had allowed clients to place substitute mutual fund orders after the market close when their original orders were rejected by Schwab’s electronic order systems and could not be processed as originally submitted.

All of the original orders were placed before the close, the company said; however, the SEC determined that a number of the order substitutions in question were not permitted under SEC rules.

Since the issues were identified, Schwab has implemented a number of enhancements to its systems and procedures, including improved oversight of order-processing activity; increased reporting and documentation of mutual fund order-processing activity and supplemental training, the company said.