Brokerage giant Charles Schwab Corp. agreed yesterday to pay $350,000 to end a Securities and Exchange Commission investigation into allegations that its brokers improperly allowed some customers to change hundreds of mutual fund orders after the New York stock markets closed.

The alterations violated national rules requiring that orders placed after 4 p.m. Eastern time be filled at the next day's prices, the SEC said. But the commission found the San Francisco firm did not profit from the arrangement, and there was no evidence that Schwab's customers exploited the firm's procedures to engage in systematic "late trading" -- short-term investments made in an attempt to profit from news announced after the markets close.

Instead, the firm found that when Schwab's computers rejected a customer's order for legal reasons -- such as because the fund was closed to new investors -- brokers would call the client back after hours and give the customer a chance to make an alternative trade. Schwab's top management did not know of the practice, the SEC said.

Schwab stopped the practice in October 2003, after New York Attorney General Eliot L. Spitzer brought fraud charges against a New Jersey hedge fund for engaging in late trading, and the SEC began investigating the problem.

"Schwab management failed to ensure that their personnel knew and understood the mutual fund pricing rules. In order to maintain a fair playing field, broker-dealers must make certain that their personnel understand and enforce both the letter and spirit of the rules," SEC Assistant District Administrator Marc J. Fagel said in a statement.

Schwab officials said in a press release that the altered trades represented only a few hundred of the 34 million trades the firm executed between 2001 and 2003, and there was no evidence that any customers were able to use substitute trades to profit from breaking news. As is customary in SEC settlements, the firm did not admit or deny wrongdoing.