restitution for cheating fund management clients.

The payments result from regulatory breaches by Jardine Fleming Investment Management Ltd. (JFIM) and Jardine Fleming Asset Management Ltd. (JFAM), both wholly-owned subsidiaries of Jardine Fleming Holdings Ltd., Hong Kong's oldest merchant bank.

British regulators also terminated UK licences of JFAM.

JFAM's former chief executive, Robert Thomas, lost his British and Hong Kong licences.

The fines are among the biggest ever imposed by Britain's fund management watchdog, Investment Management Regulatory Organisation (IMRO).

IMRO fined JFAM $623,000 and fined three Robert Fleming units $156,000 each.

Jardine Fleming, whose holding company Jardine Fleming Group Ltd. is Bermuda-registered, said it will pay $19.3 million to three clients, according to Bloomberg business news service.

The firms will also cover $190,000 in IMRO costs.

The largest fine ever imposed by IMRO was $1.2 million against Invesco Plc in connection with the Maxwell affair.

"This has been a painful experience for our group,'' Jardine Fleming Holdings Ltd. chairman Henry Strutt said.

The news won't help the territory's biggest investment bank as it tries to cement its position as Asia's leading stock brokerage outside Japan.

Jardine Fleming, founded in 1970 as a joint venture between Robert Fleming & Co. of London and the $13-billion Jardine Group, manages about $22 billion worldwide.

IMRO found that JFAM, based in Hong Kong and regulated from London, cheated some clients in the way it allocated securities trades.

Some profitable transactions were allocated to certain funds at the expense of others, said Paul Bateman, chairman of Robert Fleming Asset Management in London.

JFAM also violated rules by farming out the management of $3.1 billion of clients' money to a sister company that did not have controls in place to monitor trading. IMRO said JFAM also misled clients about how commissions were paid and didn't take immediate steps to correct the monitoring problems once it learned of them.

"IMRO's investigation has amply illustrated the danger of firms paying insufficient attention to the responsibilities that arise when they delegate business to another entity,'' IMRO chief executive Phillip Thorpe said.

JFAM delegated the management of $1.3 million to a sister company, Jardine Fleming Investment Management Ltd. (JFIM). Three Robert Fleming units passed $1.9 billion of clients' money to JFIM. All of that money was invested in Asian markets, Jardine's stronghold.

Yet JFIM "did not have in place adequate procedures for compliance monitoring of dealings,'' IMRO said.

"When they were in place, they were not always followed, and this was not adequately addressed by JFIM's management.'' In a statement, Jardine Fleming said its deficiencies in compliance -- reporting and processing trades -- "disadvantaged'' three clients. Two of them were Jardine Fleming publicly-traded investment funds, JF Pacific Securities Trust and FFF-Fleming Pacific Fund.