"Philadelphia Stock Exchange Head Investigated in Ashton Stake
(Old history, but like JBOH the story still holds)
New York, Sept. 5 (Bloomberg) -- The Philadelphia Stock
Exchange said it's examining some of its members' relationships
to Ashton Technology Group Inc., which won a contract to build a
trading system for the exchange a year ago.
According to a Securities and Exchange Commission filing,
the exchange's chairman Vincent Casella owns 152,000 shares of
Ashton, a maker of electronic transaction systems.
The New York Times reported the exchange is investigating
Casella, who headed the committee that recommended entering into
the agreement with Columbia, Maryland-based Ashton.
In September 1995, the Philadelphia exchange awarded
Ashton's UTTC subsidiary a contract to build a Universal Trading
System on the exchange's equity floor.
Casella, who became chairman of the exchange in March, has
owned shares of Ashton through Medford Financial, an
institutional brokerage firm where he is a principal, since April
1995, according to the SEC filing by Ashton.
That relationship is drawing scrutiny. ''Earlier this
summer, outside counsel was engaged to assist the Exchange in
reviewing certain facts pertaining to the relationship of certain
of its members to the provider of the (Universal Trading
System),'' the Philadelphia Stock Exchange said in a statement. A
spokeswoman to declined to elaborate.
In April 1995, Medford, which owns 400,000 shares of Ashton,
agreed to provide a $100,000 standby loan to Ashton, according to
the SEC filing. The company used the loan by November 1995 and
repaid it in May, the month it went public.
Today, Casella's stake in Ashton was worth about $750,000,
as shares fell 11/16 to 4 15/16, the low since the stock began
trading. On May 28, Aston stock hit a high of 15 1/2.
Casella was traveling outside the U.S. and unavailable for
comment, according to the spokeswoman for the exchange. The stock
exchange also said in its statement that ''no conclusions have
been drawn regarding the facts in this matter, and the exchange
urges others to do the same.'' |
