SEC Sues Former Heartland

Discussion in 'Prop Firms' started by brad1970, Jan 14, 2003.

  1. brad1970


    01/14 11:24A (DJ) *DJ SEC Sues Former Heartland, Datek Traders For Stock Fraud
    Story 4077 (I/SCR, G/SEC, G/USG, N/DJN, N/DJPF, N/DJRT, N/CRM, N/DJS...)
    (MORE) Dow Jones Newswires
    01-14-03 1124ET
    Additional Codes ( N/DJSS, N/DJWI, N/SNEW, N/XCH, M/FIN, M/MMR, P/HDL,
    R/NME, R/US)
  2. Heartland Securities, Brokers to Pay $70 Mln to Settle Charges
    By Neil Roland

    Washington, Jan. 14 (Bloomberg) -- Heartland Securities Corp., a day trading firm, and four brokers with its predecessor firm, Datek Securities Corp., agreed to pay $70 million to settle securities fraud charges.

    The Securities and Exchange Commission alleged that Sheldon Maschler, Erik Maschler, Jeffrey Citron, and Michael McCarty executed millions of illegal proprietary trades on the Nasdaq Stock Market's Small Order Execution System. The defendants hid their fraud from 1993 to 2001 by creating fictitious books and filing false regulatory reports, the SEC said.

    Sheldon Maschler agreed to pay $29.2 million in penalties and Citron $22.5 million, among the largest regulatory penalties ever assessed against individuals, the SEC said.
  3. :eek:

    they agreed to pay 70 mill....!!! sheesh wonder what they made if that is what they agreed to pay.
  4. Sounds like those illegal proprietary trades were profitable....... for a while anyways. Even if there is a punitive element to the penalties these guys must have made a shit load to agree to the settlement!:eek:
  5. where was that story? that seems excessive compared to what og, I don't know, the ENRON guys got.....where's the link?
  6. or maybe the choice was pay $70mill or sit in prison and be someone's beeeeaaaatch for 5yrs...I'd pay.

    the story is's the link
  7. I stand corrected....that seems extreme but if you are going to play ya gotta pay...
  8. i have a problem with this.

    The SEC comes along, with the cooperation of the NASD (which is made up of dealers, whose edge the 'SOES Bandits' took), and manages to take back 70 million of the dollars the dealers lost in a competitive marketplace.

    I can't say that I'm convinced justice was done. Especially since the conduct that earned penalties one year -- trading for the firm's own account -- was blessed the next. It almost seems like the establishment came out on top. Again.

  9. I knew there were all kinds of games being played at the old Datek , but the Machevellian details still amaze.

    Yes, I believe they made a lot more money than they were fined.

    Yes, these are the folks that brought you ISLD.

    Yes, crime does pay.
    #10     Jan 19, 2003