23 February 2017
Visit experienceinfosys.com

SEC charges optionsXpress over naked short selling scheme

17 April 2012  |  3139 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  |  5418 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  |  8330 views  |  0 comments
Short-selling ban stirs e-trading confusion

Short-selling ban stirs e-trading confusion

25 September 2008  |  4626 views  |  0 comments

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit BNP paribasVisit Yelloco.co.ukvisit dh.com

Who is commenting?

Top topics

Most viewed Most shared
hands typing furiouslyBlockchain Technology
13267 views 1 | 13 tweets | 6 linkedin
EBA to relax controversial PSD2 authentication rulesEBA to relax controversial PSD2 authentica...
11392 views comments | 51 tweets | 70 linkedin
RBS to become fintech fund and high street outlet for challenger banks under HMT remedyRBS to become fintech fund and high street...
7994 views comments | 40 tweets | 33 linkedin
Standard Chartered connects corporate customers to WeChatStandard Chartered connects corporate cust...
6251 views comments | 17 tweets | 19 linkedin
High rate of defaults hit P2P lending sectorHigh rate of defaults hit P2P lending sect...
6178 views comments | 17 tweets | 13 linkedin

Featured job

Six Figure Base + Commission + Stock Options
London

Find your next job