http://news.yahoo.com/s/nm/20050815/bs_nm/financial_squawkbox_sec_dc Brokers accused in U.S. fraud scheme WASHINGTON (Reuters) - The U.S. Securities and Exchange Commission on Monday charged four brokers and a day trader for scheming to trade ahead of large orders and profiting from the subsequent price movements. The day trader, John Amore, was accused of having paid brokers who had worked at three Wall Street firms to gain live audio access to the firms' so-called "squawk boxes" that broadcast institutional orders to buy or sell large blocks of securities. Traders at Amore's firm listened to the squawk boxes and traded ahead of the large orders to make a profit from the price movements, the SEC said. The brokers charged by the SEC are Ralph Casbarro, who worked at Citigroup Global Markets; David Ghysels, formerly at Lehman Brothers; Kenneth Mahaffy, formerly at Merrill Lynch and Citigroup; and Timothy O'Connell, formerly at Merrill Lynch. On more than 400 occasions, day traders at A.B. Watley, the brokerage unit of Watley Group, where Amore was chief executive officer, traded ahead of the large orders between at least June 2002 and September 2003, making gross profits of at least $650,000, the SEC said. The brokers were compensated about $290,000 for their part and Casbarro and Mahaffy were compensated with secret cash payments, the SEC said. "These brokers were duty-bound to keep information about large customer orders confidential and to use it to benefit the customer," Mark Schonfeld, head of the SEC's northeast regional office, said. Attorneys representing Amore, O'Connell, Mahaffy, Ghysels and Casbarro could not immediately be reached for comment.