Carefull TRAV: The noose continues to tighten on Crim brokers:
Monroe Parker Securities Ex-Employees
Are Indicted on Charges of Stock Fraud
By DEBORAH LOHSE
Staff Reporter of THE WALL STREET JOURNAL
In one of the largest-ever criminal stock-fraud cases, the New York
attorney general's office announced the indictment of 12 principals and
brokers from defunct Monroe Parker Securities Inc. on charges they
defrauded investors of $100 million in the sale and trading of at least 15
small stocks. The firm also was named in the indictment.
The attorney general, Dennis Vacco, alleged that from 1994 to 1997 the
group manipulated the stock price of targeted "house stocks," using
abusive selling tactics such as implying they had inside information or
withholding key information to persuade customers over the phone to buy
stocks.
In many cases, the Monroe Parker brokers also failed to tell customers to
whom they were touting stocks that the principals or brokers were selling
their own cheaply acquired holdings to them at inflated prices, the attorney
general alleged. "They traded against the interest of their clients," Mr.
Vacco said at a news conference. Mr. Vacco, a Republican, is seeking
re-election in November.
One of the brokers indicted is 33-year-old
John P. Clancy, who was featured in a June 1
page-one Wall Street Journal article
describing audiotapes of him teaching
aggressive sales techniques to rookie brokers. Mr. Clancy, who like many
of the indicted brokers has an extensive disciplinary record with regulators,
was charged with 13 felony counts including grand larceny.
Arrest warrants were outstanding for Mr. Clancy and Louis E. DiFruscio,
a broker with Fin-Atlantic Securities in New Hyde Park, N.Y., after
investigators couldn't locate them in the Friday morning arrest-roundup of
six other brokers. Mr. Clancy's attorney, Maranda Fritz, didn't return a
call seeking comment. Mr. DiFruscio's attorney couldn't be reached.
Former Monroe Parker President Alan Lipsky and Vice President Bryan
Herman each were charged with 35 felony counts. Prosecutors allege they
made $22 million from the selling tactics. Monroe's compliance director,
Richard Levitov, was charged with 25 counts, and head trader Ralph
Angeline with 25 counts. All four of the men pleaded not guilty. The
indictment supercedes a New York State complaint issued in May. The
four men were arrested at that time and have been free on bail.
Monroe Parker, which was based in Purchase, N.Y., shut its doors after
the National Association of Securities Dealers filed a complaint against the
firm and four of its officials in January. That complaint is still pending.
Attorneys for Messrs. Lipsky, Herman, and Angeline said Friday they had
no comment. Mr. Levitov's lawyer said his client has "no criminal liability."
Messrs. Lipsky and Herman were indicted last month in a separate case
by federal prosecutors in New York on related charges. That case is still
pending as well.
The six other brokers, who were indicted Friday and were being held in
jail pending raising bail, are: Daniel J. DiMaria, a now-unemployed broker
who last worked at J.B. Sutton Group, Great Neck, N.Y., according to
the attorney general's office; Stephen M. Kiront, formerly employed at
VTR Capital Inc., Valley Stream, N.Y.; Barry M. Kiront of Raike
Financial Group Inc., Westbury, N.Y.; Steven A. Anello, of Emerson
Bennett & Associates, Harrison, N.Y.; John Tinnelly, of FinAtlantic
Securities, Inc., Hawthorne, N.Y.; and Michael O'Donohue, also of
Fin-Atlantic.
An attorney for Mr. Anello, Michael Bachner, called the charges against
his client "completely baseless." Attorneys for the other brokers had no
comment or couldn't be reached.
Ten of the 12 indicted had worked at Stratton Oakmont Inc., which was
shut by the NASD nearly two years ago.
interactive.wsj.com
Any of those guys join your ex First Jersey brokers, TRAV? |
