Jack Grubman: SEC Targeted Me and Other Top Analysts

He was a Wall Street superstar in the 1990s—a go-to analyst for coverage of the telecommunications industry.

But in 2003, Jack Grubman, a former managing director of Salomon Smith Barney, settled with the Securities and Exchange Commission over allegations of analyst conflict of interest, paid $15 million in penalties, and was permanently barred from the securities industry.

Now a decade later, he's breaking his silence—talking about what happened then and what's changed since.

"The Chinese have an old saying: 'Lightning doesn't strike the short trees,'" Grubman started Friday on CNBC in his first television interview since the settlement. "Clearly there was a focus on those of us who were more high profile."

Others—including Henry Blodget, a former managing director at Merrill Lynch and now head of Business Insider, who settled with the SEC for $4 million—were caught up in the agency's investigation into allegations of undue influence of investment banking interests on research analysts at brokerage firms.

"Unfortunately, part of what was going on then was you had a commingling in the investment banks between research, banking, sales, trading," Grubman said in a "Squawk Box" interview. "Everybody was working for the same enterprise, trying to maximize the profitability."

(Read More: Dish Trying to 'Agitate' Sprint, Not Buy: Grubman)

"I don't know if anything was right or wrong," he said. "It was just what it was at the time."

"There was no underlying conflict because whether it was me … [or other analysts] let's be crass about it," he added. "If we wanted to maximize our personal income, the way you did it was to be highly ranked by institutional investors. … And that meant doing good research."

Ten top investment firms also settled with the SEC in 2003 over these practices and agreed to pay $1.4 billion penalties.

In a press release announcing the agreement, the SEC had wrote:

"In addition to the monetary payments, the firms are also required to comply with significant requirements that dramatically reform their future practices, including separating the research and investment banking departments at the firms, how research is reviewed and supervised, and making independent research available to investors."

"Here we are … years later after the 'grand settlement' … has anything changed? I would argue not really," Grubman said. "I'd say there's maybe change in form but not substance in terms of today's Wall Street research."

"Back then if you were pitching for an [initial public offering], yes, the analysts and the bankers would come into the same meeting. Bankers would talk about the firm … and we would talk about our investment thesis," he said. "Guess what happens now? There are two meetings instead of one meeting."

"The analysts will [now] come in separate from the bankers—so they're not in the room at the same time. Big deal," he said, but added they "are still going to pitch for the IPO, just like what happened 15 years ago."

Today, Grubman still follows the telecommunications industry closely and advises companies in that field through the firm he founded in 2003 called Magee Group.

Reflecting on his past troubles, he told CNBC, "At the time I decided to settle, put it behind me, and move on and focus on the next stage of my life, which is the right thing to do."

By CNBC's Matthew J. Belvedere. Follow him on Twitter @Matt_SquawkCNBC.