25 May 2017
Visit cib.db.com

SEC charges optionsXpress over naked short selling scheme

17 April 2012  |  3196 views  |  0 Digital Abstract

The US Securities and Exchange Commission has charged online brokerage optionsXpress, four of its employees and one customer in connection with a naked short selling scheme.

According to the SEC's order, from at least October 2008 to March 2010, the Chicago-based firm repeatedly engaging in a series of sham "reset" transactions designed to give the illusion that it was complying with short selling rules.

As well as Feldman and the company itself, former CFO Thomas Stern and customer Jonathan Feldman have been charged by the SEC over the scheme.

Head of trading and customer service Peter Bottini and compliance officers Phillip Hoeh and Kevin Strine were named in a separate administrative proceeding and settled the charges against them for their roles.

Robert Khuzami, director, division of enforcement, SEC, says: "Feldman and optionsXpress used sham reset transactions to avoid, sometimes for months, compliance with Reg. SHO's stock delivery requirements. In effect, they 'kited' shares of stock, thus depriving buyers of the benefit of their bargain - prompt delivery of their shares."

OptionsXpress was acquired by Charles Schwab for around $1 billion in stock late last year.

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Schwab agrees $1bn optionsXpress acquisition

Schwab agrees $1bn optionsXpress acquisition

21 March 2011  |  5458 views  |  0 comments
EC bids to tame 'wild west territory' of OTC derivatives and short selling

EC bids to tame 'wild west territory' of OTC derivatives and short selling

15 September 2010  |  8392 views  |  0 comments
Short-selling ban stirs e-trading confusion

Short-selling ban stirs e-trading confusion

25 September 2008  |  4685 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit dh.comDownload the paper nowvisit vasco.com/news/PSD2-compliant-solutions

Top topics

Most viewed Most shared
BBVA launches Open API marketplaceBBVA launches Open API marketplace
9828 views comments | 46 tweets | 66 linkedin
Banks must get on AI bandwagon now – new Finextra researchBanks must get on AI bandwagon now – new F...
9602 views comments | 22 tweets | 31 linkedin
Twins fool HSBC voice biometrics - BBCTwins fool HSBC voice biometrics - BBC
9179 views comments | 21 tweets | 24 linkedin
UK SMEs missing out on £1.6bn by not accepting 'next gen' paymentsUK SMEs missing out on £1.6bn by not...
6889 views comments | 25 tweets | 18 linkedin
BBVA brings info and payments to social and messaging networksBBVA brings info and payments to social an...
6860 views comments | 11 tweets | 17 linkedin

Featured job

Six Figure Base + Commission + Stock Options
London

Find your next job