The Securities and Exchange Commission, sending a message to brokers who sell risky options investments to unsuspecting or unsuited customers, has come down on Smith Barney Harris Upham & Co. for overly aggressive options-selling by one of its branch offices and a failure to properly monitor the activities -- which cost nine customers a total of $780,000.

The commission "censured" the brokerage house and warned that brokerages should not lose sight of SEC rules and responsibilities to clients in the interest of building business in the fast-growing options field and other parts of the securities industry.

In a settlement agreement with the SEC, Smith Barney neither admitted nor denied any of the charges made against it by the commission, but the brokerage said it would tighten its supervision and monitoring of salespeople and "more fully inform customers of the risks involved in trading uncovered options." The company was not required to make restitution to the customers.

In the order it released yesterday against Smith Barney, the commission said it "is concerned about the inherent tension between productivity and adequate supervision in light of the competitive conditions presently confronting the securities industry. A production-oriented policy raises the concern that some broker-dealers may overlook compliance-related difficulties by employes who are top salesmen. . . .

"Firms must be alert to whether salesmen have persuaded unwitting and unsophisticated customers, who are unaware of the risks they are assuming, to engage in elaborate trading schemes involving uncovered options," the commission added. "These trading programs may provide some profits in the near-term, lulling the customers into a false confidence before a sudden turn of events produces devastating losses."