Washington ? Securities regulators have accused H&R Block Financial Advisors of fraud in selling customers nationwide some $16 million of Enron bonds in late 2001 and touting them as a safe investment when the energy-trading giant had begun to collapse.

The National Association of Securities Dealers, the brokerage industry’s self-policing organization, announced its complaint Monday against the investment division of the world’s largest tax preparer. Companies can be fined or suspended from the securities industry if found to be in violation of NASD rules in a disciplinary hearing process.

H&R Block Inc., based in Kansas City, Mo., disputed the allegations and said it would contest them through the NASD’s hearing process.

“We deeply regret that our clients experienced losses from the devaluation of Enron bonds,” said Nick Spaeth, senior vice president and chief legal officer of H&R Block. “However, the lost value was the result of mismanagement and bankruptcy at Enron that later came to light, not the result of actions or omissions on the part of H&R Block Financial Advisors. At the time of sale, these bonds were rated investment grade by the national rating services, and evidence of internal fraud at Enron had yet to be discovered.”

NASD said that in the five weeks preceding Enron’s bankruptcy filing on Dec. 2, 2001, while Enron’s financial crisis was coming to light and government investigations were initiated, some 200 brokers at H&R Block recommended and sold more than $16 million in Enron bonds to about 800 customers in 40 states. The brokers “made affirmative misrepresentations to customers, touted the supposed benefits of the Enron bonds, and failed to disclose the serious and significant risks associated with an investment in the bonds,” the NASD alleged.