Trader gets away with $60 million interpositioning scheme

Discussion in 'Wall St. News' started by peilthetraveler, Dec 24, 2011.


    So from reading this, it seem this trader who basically took this pension fund for $65 million dollars, only has to pay $1 million for ill-gotten gains and his former company has to pay $4 million, plus he is barred from being a trader for the next 5 years and that settles ALL charges meaning he got to walk away from this deal with $60 million dollars.

    Strange how easy wall st. is on their own kind. If someone robbed a bank and got $65k they sure as hell wouldnt agree to let them go free if they returned $5k of it. Heck, they would get jail time even if they returned all of it.
  2. The odd thing about these and similiar cases is you never hear about the tax consequences.The trader made 60 m probably paid 1/2 in taxes. The pension fund who had the loss has a major write off (for whatever that is worth). Deconstructing the trade would be a considerable loss of tax revenue.

    Ya think anyone is getting a refund with interest from the IRS on a clawback re Madoff? Probably a lot of silly ass games behind the scenes us peons no nothing about.
  3. Its also possible that the trader made the pension fund hundreds of millions of dollars so maybe they didn't want to push it, but we will never know.
  4. nothing new. read articles from an insider in the industry. apparently 9 out of 10 hedge funds during the dotcom bubble was not legit and more or less siphoning funds to swiss bank accounts. for example a guy steals literally 20 million. how did the SEC apparently handle this? a 100k fine.

    This happened 10 years ago, how can you think the SEC will overfine instead of underfine, beats me, you must not get out much.
  5. Suspicion should have been aroused more quickly when it was discovered that people with Hispanic surnames were involved with an investment company. :eek:
  6. that ping pong trading sounds like stuff Ive seen on the exchanges over the years. bet plenty of pension funds have been took for large coin.
  7. Not suprising at all, in fact this is how most join the 1% club. Basically just high paid con artists that make enough to buy their way out of any real consequences should they get caught.
  8. Options12

    Options12 Guest

    But then there have been some very large fines levied for this kind of behavior.

    In 2004, Knight Securities paid more than $70 million to settle claims that they defrauded their institutional customers by not fulfilling Best Execution obligations.
  9. =========
    Good points P-tt.

    Also you may want to note in your scenerio;
    its much better not to use a gun, in a theft.Loss of life frequently happens to the robber.

    And not to laugh off a bank or securities ripoff.
    But between that Mexican middleman deal, penny stocks, near Los Angeles[Angels] , that pension fund was probably the main party hoping & praying for a quick, get this thing out of the papers/settlement.LOL

    Also note Mr Rodrigez[now living ''safely'' in Mexico] was not just barred from any investment co work for 5 years; but participating in any penny stock offering for 5 years.:cool: