Broker-Dealer Litigation - Greenberg Traurig LLP

clearance trades without being a registered principal, enabled investment bankers to trade
without pre-clearance, failed to obtain and/or timely obtain completed questionnaires and
disclosure forms necessary to review employees’ outside account transactions, and failed to
request and review employees’ outside account statements to identify possible improper trading.
The Commission ordered the Firm to pay a $850,000 civil penalty and to cease and desist
from committing or causing any violations and any future violations of Section 15(g) of the
Exchange Act. The Firm also undertook to retain an independent consultant to review the Firm’s
policies and procedures relating to Section 15(g).
In re Tudor, Release No. 65009, 2011 SEC LEXIS 2616 (Aug. 2, 2011).
Q.1.e(i)
The Commission accepted an offer of settlement from Tudor, a registered representative
and proprietary trader associated with a registered broker-dealer. In an earlier action brought by
the Commission, the federal district court entered judgment by consent against Tudor,
permanently enjoining him from future violations of the antifraud provisions of the federal
securities laws. The Commission alleged that Tudor was tipped material, nonpublic information
and traded on the basis of that information. The Commission barred Tudor from association.
In re Hansen, Release No. 65513, 2011 SEC LEXIS 3532 (Oct. 7, 2011).
Q.1.e(i)
The Commission accepted an offer of settlement from Hansen, a former associated
person of a registered broker-dealer. In an earlier criminal proceeding, a federal district court
convicted Hansen pursuant to his guilty plea for conspiracy to commit securities fraud and
securities fraud. In an earlier civil proceeding brought by the Commission, a federal district
court entered a final judgment by consent against Hansen, permanently enjoining him from
future violations of the antifraud provisions of the federal securities laws. The Commission’s
complaint alleged that Hansen traded on tips of material, non-public information that he knew or
was reckless in not knowing had been dispensed improperly. The Commission barred Hansen
from association and from participating in any offering of a penny stock.
In re Skowron, Release No. 65783, 2011 SEC LEXIS 4065 (Nov. 17, 2011).
Q.1.e(i)
The Commission accepted an offer of settlement from Skowron, a managing director
associated with a registered broker-dealer, a co-portfolio manager for six hedge funds, and an
officer of the investment adviser to the hedge funds. In an earlier proceeding brought by the
Commission, a federal district court entered a judgment by consent against Skowron,
permanently enjoining him from violating the antifraud provisions of the federal securities laws.
The Commission’s complaint alleged that Skowron ordered the sale of approximately six million
shares of stock of a company based on material non-public information he had been tipped,
thereby avoiding losses of approximately $30 million. In a related criminal proceeding,
Skowron pleaded guilty to one count of conspiracy to commit securities fraud and obstruct
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