Broker Pleads Guilty to Securities Fraud Conspiracy
Benjamin Chouchane, a former broker for LinkBrokers Derivatives Corp., a unit of London-based ICAP Plc (IAP), pleaded guilty to making millions of dollars by lying about the prices of securities bought and sold for clients.
Chouchane, arrested in October with Marek Leszczynski, another ex-LinkBrokers employee, was charged by Manhattan prosecutors in the office of U.S. Attorney Preet Bharara with scheming to commit securities and wire fraud. He pleaded guilty today before U.S. District Judge John Keenan to one count of conspiracy, his lawyer Marc Mukasey said in a phone interview.
“This is the first step towards putting this matter in the rear view mirror and we are thankful that the matter is now in Judge Keenan’s hands,” Mukasey said.
The U.S. said that Chouchane, Leszczynski and others misrepresented the prices at which securities were bought and sold, earning their employer illegal profits and bonuses for themselves
Chouchane was indicted with Leszczynski in December on two counts of conspiracy to commit securities and wire fraud and a count of securities fraud. A third man, Henry Condron, pleaded guilty in October to being part of the scheme, the U.S. said.
Chouchane also today agreed to forfeit $5 million earned as proceeds traceable to his crime, court records show.
Keenan set sentencing for Oct. 24. Mukasey said Chouchane faces a possible five-year prison term and that he will argue for probation
All three men are former employees of the same brokerage firm, which prosecutors didn’t identify. Finra records show the men all worked for LinkBrokers.
The U.S. Securities and Exchange Commission alleged in a suit filed in October that the three men and a fourth former LinkBrokers employee, Gregory Reyftmann, illegally took $18.7 million from customers by reporting fake execution prices on more than 36,000 transactions over four years.
The criminal cases are U.S. v. Chouchane, 12-cr-00923, and U.S. v. Condron, 1:12-cr-00768. The SEC case is SEC v. Leszczynski, 12-cv-7488, U.S. District Court, Southern District of New York (Manhattan).
---With assistance from Bob Van Voris in federal court in Manhattan. Editors: Charles Carter, Glenn Holdcraft
To contact the reporter on this story: Patricia Hurtado in federal court in Manhattan at firstname.lastname@example.org.
To contact the editor responsible for this story: Michael Hytha at email@example.com.