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Trader Pleads Guilty To Illegal Purchase of Nearly $1B In Apple Stock
An anonymous reader writes "A trader who last year made an unauthorized purchase of nearly US$1 billion worth of Apple stock has pled guilty to wire fraud, securities fraud and conspiracy. On October 25, 2012 — the same day Apple posted its Q3 2012 earnings — David Miller of Rochdale Securities made a number of unauthorized purchases of Apple shares which ultimately led to the demise of the financial services firm he worked for. The aim of Miller's action was to make a lot of money very quickly by purchasing large quantities of Apple shares and selling them in a post-earnings surge."
oh wait
never mind
at least the Mac blogs i still read keep on pumping the stock
The stupidity of some people baffles me.
TheVeryBest
Is it worth throwing a minimum of 5-8 years of your life away for money?
TheVeryBest
Buy $1bn worth of shares in the name of your company. If it works out and the shares go up by one percent, sell them for $1bn and $10 million, take the $10 million, and run. If it doesn't work out, your company goes broke and you go to jail.
Because then he would have gotten a reward instead of an investigation.
I would be surprised if the plea agreement that is allowing him to only serve 5-8 years will allow him to keep any commissions he made on his fraudulent sales. Even without the plea agreement, I doubt he would keep any of the money.
I assume he will have to declare bankruptcy after the firm goes after all of his money to pay back some of their losses.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
If he made $1m on commissions (easily)...
Would you go to jail for 5 years and walk out making $200k/year with $0 expenses?
you forgot a minor point: he doesn't get to keep the money, he just gets the jail time.
... he bought 1,623,375 iPhone instead?
no because you have to return the money and pay additional fines on top of the jail sentence in cases like this
and you will never be able to work in finance jobs
ME FIRST!
"When information is power, privacy is freedom" - Jah-Wren Ryel
Is it worth throwing a minimum of 5-8 years of your life away for money?
Oh please, he's going to a white collar resort prison, not a federal pound-me-in-the-ass prison.
Is it worth throwing a minimum of 5-8 years of your life away for money?
Most people trade ~40 hours per week of their life for money. That adds up to 5-8 years after a while.
I have a job, you insensitive clod!
Is it worth throwing a minimum of 5-8 years of your life away for money?
I had a job like that.
Somehow this is Tim Cook's fault. Steve Jobs would never have let it happen. Also it proves the inherent superiority of Android over the iPhone. I just haven't quite figured out how yet. I'm sure somebody will, though.
Color me skeptical, but for some reason I doubt that a trader who recklessly threw a billion dollars on the stock market roulette table and *won* would be outed by his firm and sent to jail. Rather, he'd be the "ballsy financial genius" who'd be in charge of $10 billion next time. And of course, this type of perverse incentive system only encourages the next thrill-seeking gambling addict to try their own play. A few years in a minimum security white-collar slammer, versus the chance to take your cut of zillions in winnings gambling on others' money? Sounds like a gamble far too many "I earned my position by skill, not chance!" scamming scum would take.
From the article:
Later that day, Apple posted solid earnings, but as is typically the case after an earnings report, shares of Apple went down over the next few days.
Seems if he was worth anything as a trader he would have known this and thought up a better plan.
You really think his trading firm would out him and send him to jail if he *made* money, instead of giving him a raise and a promotion?
The poor bloke clearly hadn't heared about portfolio diversification.
Thank goodness this would never happen with Bitcoin!
I have one like that right now...it's not so good with the money part though.
"When information is power, privacy is freedom" - Jah-Wren Ryel
"This defendant participated in a fraudulent scheme in which he would either reap huge profits through the unauthorized purchase of approximately $1 billion of Apple stock or, if he faced huge losses, explain it away as simple human error"
how is this in any way different than regular financial trading? it seems to me the word 'unauthorized' was applied after the investment company decided this guy was a nuisance.
again:
"Risk is inherent in the investment world, but that risk should never be borne from the actions of investment professionals who choose to serve their own financial agendas rather than those of their client" stated FBI Special Agent in Charge Mertz.
if investment bankers didnt serve their own financial agendas im sure Lexus would be a far less profitable company and the hamptons would have a few less mailboxes. this guy wasnt arrested for anything as far as the FBI is concerned related to a specific SEC violation. i venture he was arrested for
Good people go to bed earlier.
Bankruptcy wont save him from court ordered restitution nor from unsecured liability. The scope of bankruptcy is actually pretty narrow. The public always seems to think "Ah fuck it I'll just file bankruptcy and 7 years later have a clean slate!" when the reality is very different. Typically people still have to pay back what they owe. Occasionally what they owe will be negotiated down so that they aren't living in a card board box but they can go decades before they get back on their feet and all the while some judge will be telling them how much they can spend on cereal and what type of car they are allowed to drive. It's not pretty.
I'm at a loss to imagine how these idiots thought this was going to work. No one is going to miss a $1 Billion transaction. Maybe they thought their bosses might overlook it if they made a hefty profit. I'd love to have seen the looks on their faces turn from worry to terror as the stock prices fell after the earnings report came out and they realized they weren't making money, but loosing it hand over fist. In the end the firm lost over $5.3 Million according to the article. Could have been worse though, Apples stock price overall continued to fall from that then till now.
I bet he earned close to that while he was employed at that firm be bankrupted.
Wow, an 8 year stint comes out to about 33.72 years of 40 hour weeks. If you could keep the money, it might just be worth it after all.
How was the trade unauthorized? At the SEC/Federal level or the company level? If it is the company, then there should be no jail time. It is the company's fault for allowing one individual do such a trade and the company should be punished by the SEC if it broke a trading rule. Just like companies own the Intellectual Property of employees, they should be owning the crimes by employees committed filling their job role.
...to not fail, apparently.
Erm. How does one spend ONE BILLION dollars unauthorized? Wouldn't the firm be at fault? Someone singularly has the ability to decide to spend a billion dollars on something?
"I doubt he would keep any of the money."
Keep WHAT money? He LOST on the stock market. He didn't make any money.
Is it worth throwing a minimum of 5-8 years of your life away for money?
Of course it is not worth it if you get caught.. But for most financial shenanigans, the chance of getting caught is pretty low. If enough other people are doing the same thing, there is safety in numbers, and instead of going to jail, you get a bailout. This guys problem was that he made a bet too big to go unnoticed, and he was very unlucky. He isn't being punished for making an illegal bet. He is only being punished for losing the bet.
Yes. Unauthorized large transactions = jail time. Win or lose.
-- SEC, FINRA Enforcement Section
http://www.finra.org/web/groups/industry/@ip/@reg/@notice/documents/notices/p038276.pdf
The small fry is trying to play a big boy's game, and he picked the wrong target.
“He’s not deformed, he’s just drunk!”
how much money? If it mean never needing to work again after 5-8 years, then maybe.
The Kruger Dunning explains most post on
If AAPL had gone up, the guy would be a conquering hero raking in $millions in surprise bonuses. It's the same method Dr. House used to avoid punishment. Too bad this guy didn't realize that Apple is out of steam.
HIs trading firm lost close to 6 million as a result of a trade that went bad for him that they did not authorize. They are probably the ones who reported him in the first place. All the other times he's done this, he's made money, but only for himself / accomplice.
They would keep the earnings and hopefully fire him.
That's the rule according to the SEC, but the SEC has largely been gutted of power to closely monitor and regulate what actually goes on. This guy is going to jail because his own investment firm outed him. If you're an investment firm boss, and one of your employees just lost you millions, you'll gladly blame the loss on a rogue employee (not standard firm operating procedures). But what if you just made millions? Is this when you announce to the world "no, we're not an especially clever investment firm, we just have dangerous loose cannons at our trading desks who got lucky this time."? Or, do you cover for your employee's actions; give him a nice bonus to keep quiet, and retire from the firm to a nice island mansion; and shuffle paperwork to keep the trading off the SEC's radar?
You really think his trading firm would out him and send him to jail if he *made* money, instead of giving him a raise and a promotion?
If it caused the company to go bankrupt in the process? Yes.
How is it even possible to unauthorizedly purchase stock? That sounds almost as impossible as me R-ing TFA lol. Stock either is for sale or isn't and it's all checked by computers. You can't just go to ebay and buy something that's not there and I thought stocks were the same.
Thanks - my current workplace is not QUITE as bad as prison.
I am a financial engineer and also a PhD in science, so I can tell you that trading is a pseudo science. It is very hard to distinguish real profit from the noise. Most big guys that you see making lots of money would have made zero money if they had to pay the same commission and fees as individual day trader. The big guys make money in commission, fees, private placement, special offering, mergers and so on. As this article show, the top hedge funds managing $2.6 trillion actually made less than market returns for the last 4 years. Since they charge 2% asset management fee plus 20% commission, the net proceeds they pocketed equaled hundreds of billions of dollars and that is for doing worse than passive investing. Personally, I would never invest in any actively managed funds.
I don't think this is true. It might be if his plan had been to let the company and/or the customer keep the profits - but his plan appears to have been to personally keep the profits, based on the article links. Given that, his company may well have been inclined to have him prosecuted even if the trades had resulted in profits.
Code or be coded.
some judge will be telling them how much they can spend on cereal and what type of car they are allowed to drive. It's not pretty.
Still not that ugly. We can afford more mercy nowadays. In the ancient days when you were the equivalent of "bankrupt" and had nothing else left to sell and couldn't support yourself (no land), you sold yourself as a slave.
Terrible maybe, but who would or could feed you for free? This was in the days where wheat yields were about 0.25 tonnes per hectare. Even in the 1800s yields were about 0.75 tonnes per hectare. In contrast now yields are 8 tonnes with some going even up to 15.
It's no surprise the ancient laws against sexual promiscuity could be harsh - there was no decent birth control - who wants to keep having to feed and shelter someone else's children (especially if you're struggling to feed your own family)?
I'm not optimistic like some who think there will be a "post scarcity" age.
allow him to keep any commissions he made
Just a FYI, but you probably meant to say "profits", not "commissions". (The "house" makes the commissions, not the trader.)
You all are assuming he made money on the deal. He bought at $600 prior to the earnings report, thinking the stock would go back up to $700. Instead, it tanked. Had the stock gone up I'm sure he would have been slapped on the wrist and told "don't do it again".
Seven puppies were harmed during the making of this post.
Some people still think AAPL stock is a magical money making machine. I remember one guy on TV saying that now was the time to buy, when it was at $700. I wonder how that worked out for his followers.
Seven puppies were harmed during the making of this post.
The trade was unauthorized because the information about the bonuses was "privileged" information. The SEC operates its rules for trading on the premise that all investors should at least in theory have access to the same information at the same time. In this case the broker had knowledge of the information in the quarterly reports prior to a general public dissemination of the information, therefore he had a fiduciary responsibility to refrain from trades until the information went public.
This is one reason why "insider trading" is such a major crime, and what ultimately nailed Martha Stewart (particularly as she sat as a governor on the board of trustees for the NYSE). People in "high places" have a standard of responsibility that they should be following and it is stricter than what "ordinary" investors typically operate in. That they get time to think about the impacts of this information and can anticipate market moves by having access to such information makes it important to be much more cautious when acting upon such information.
When a large number of corporate officers start to sell off stock in the company they work for (or start buying it for that matter), it is usually considered something important to consider when investing into that company. It is assumed that those officers are acting on public information or that there are external reasons for those actions (such as personal bankruptcy or a windfall of money coming their way), but it can be due to confidential information that either hasn't or won't be publicly released. The SEC is not happy if that information is unjustly exploited and costs ordinary shareholders potential profit, which is where the crime actually happens.
Bankruptcy wont save him from court ordered restitution nor from unsecured liability. .... Occasionally what they owe will be negotiated down so that they aren't living in a card board box but they can go decades before they get back on their feet and all the while some judge will be telling them how much they can spend on cereal and what type of car they are allowed to drive. It's not pretty.
What you describe is typical for the 99%, but for the 1% doing a carefully planned/structured bankruptcy it's more like a minor inconvenience.
Option 3: Tell the SEC yourself and turn him in so he takes all of the blame. Considering the SEC can't unwind trades, the firm keeps the profits and doesn't have to pay the trader's commission.
Maybe, MAYBE they get a fine, but considering the SEC would want to encourage the self-policing, I doubt it.
Learning HOW to think is more important than learning WHAT to think.
"Some companies may be wary of a reckless attitude about financial regulations especially with what has happened in the last several years."
are you suggesting that the last several years are serving to _DISCOURAGE_ reckless behavior in the financial sector?
wow...
I was going to suggest that the trader stick to frozen concentrated orange juice, but I see that it was down that day too, so it wouldn't have worked.
Depending on where you live, you may be more valuable to the economy as a prisoner. For example, the US national average wage for 2011 is about $43,000, whereas California currently spends about $50,000 per prisoner.
Maybe - I have seen this activity up close. What is the difference between an aggressive successful trader and a rouge trader? Traders tend to be type A personalities who are always testing the boundaries and some of those are subjective. Have I seen successful traders fired for doing such things? Yes - but only at select firms. Others take the profits and let it slide.
Thanks - my current workplace is not QUITE as bad as prison.
Yeah, they ream us, but not literally.
That assume he gets to keep the commission, which I doubt... Granted he could hide it somewhere, but then he'll have to launder it afterwards, an act that also carries a potential sentence.
Locking people up longer, isn't a solution, in the US you've already got more inmates per citizen than Stalin did... (no joke)
This guy isn't dangerous, just give him 5 years of community service, and make sure that if he pays back in case he ever comes into sudden wealth.
(And ofcourse make sure he doesn't get employed in the financial sector anytime soon).
Some people still think AAPL stock is a magical money making machine. I remember one guy on TV saying that now was the time to buy, when it was at $700. I wonder how that worked out for his followers.
He probably bought at $690 - that's why he was saying it was a buy at $700.
. What is the difference between an aggressive successful trader and a rouge trader?
Oh, I know this one!! The rouge trader has a pinker face.
Doubtful. It sounds like the guy was trading on his firms accounts. Such people tend to be principal traders - i.e. no commission. The general rule is that they get to take home, as a bonus, 50% of the money they make for the firm. Thus the reason my he took a huge gamble with the firm's money.
You have a very strange definition of "valuable to the economy".
Your a bit off base here. You are dead on the money about insider trading - but this is not about insider trading - this is about 3rd party trading - he was playing around with other's people money, hoping his gamble would pay off..
It is very common to give control of a account to a 3rd party either a broker or a outside advisor. They theory is that they are professionals and can trade better then you can. When this happens, certain rules are put in place by the owner of the account. Do a stop loss here, only so much in speculative trading, etc. And it looks like he broke all kinds of rules here. Some accounts he was not even authorized to trade in.
I am going to guess this is going to play out like Nick Leeson - another famous unauthorized trader.
And I kind of need to redact my statement - read up on this some more. Not a principal trader on his owns firm account. However, he was entitled to a cut of the profits, so probably was not motived by commissions - and more by wanting to hit one out of the ball park.
When you are working as a trader for some "investment" firm the firm keeps the profits (and the losses) but most of your income is in the form of commissions or bonuses.
Isn't that what commission means? If a sales person in a clothing store works on commission they get X% of their sales. If a trader works on commission he gets X% of the profits on his trades over some time frame.
Since he clearly lost a fortune his commission would be 0 of course.
As Steve Jobs proved the chance of getting your financial shenanigans acted on is slight.
iTunes on the Steam store?
Blue Horseshoe Doesn't Love Apple.
Trader's fault... He really needed to call The Wall Street Chronicle first.
Exactly. It like war. Only the losing side gets punished for crimes. If he had been on the winning side of the bet he would have been paraded around the office like a king.
Typically people still have to pay back what they owe. Occasionally what they owe will be negotiated down so that they aren't living in a card board box but they can go decades before they get back on their feet and all the while some judge will be telling them how much they can spend on cereal and what type of car they are allowed to drive. It's not pretty.
No, typically people don't pay back anything (or at least close to nothing). I know two people who have declared bankruptcy, and both of them discharged every penny of debt and kept every single possession (except one of them lost one of their cars). One kept a big screen TV and a living room set that they collectively owed over $3k for because it wasn't worth Best Buy's time to repossess items of such little value. I had read quite a bit about bankruptcy because he was asking advice before talking to a lawyer, and I was still surprised at just how easy the whole process was for him in the end.
One was even able to run up an extra few thousand on his credit cards to stock up on non-perishable food and other household items (and do needed maintenance on the car he planned on keeping), and made sure not to contact a lawyer until a few months after doing it so he could claim to not know the bankruptcy court usually does not look further back than 6 months to detect such fraud (he never paid back a penny of it). I learned a lot about bankruptcy law while helping him prepare, and his lawyer did little more than back up what he and I had already learned online. The lawyer told him that the vast majority of bankruptcies are just as easy as his was (although that is just an anecdotal claim by his lawyer).
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
Isn't that what commission means? If a sales person in a clothing store works on commission they get X% of their sales. If a trader works on commission he gets X% of the profits on his trades over some time frame.
No, a commission is a percent of the sales as you say. Not a percent of the profit. Many brokers get a percent on sales even if they lose money.
Keep WHAT money? He LOST on the stock market. He didn't make any money.
The parent post claimed that he would make a lot of money off of his commissions regardless of the profitability of the trades. I don't know if that is accurate, but even if it is I was merely stating that he wouldn't get to keep any of those commissions.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
Is it worth throwing a minimum of 5-8 years of your life away for money?
Five years of my life in a cozy cell with three squares a day for $100 million? Where do I sign up?
No sig today...
You don't really explain. I can see the company being upset at him for buying something he shouldn't. But why is this against the law?
In your example: The boss of a corner store tells an employee to buy 100 loaves of bread from the bakery, because that's how much he expects to sell. You buy 200 loaves of bread, and 100 of them go stale. The owner has every right to be angry, and possibly to fire you for costing him money. However, you will not be going to jail, because you have done nothing illegal.
So: what is illegal about buying securities that your bank didn't authorize you to buy?!?!
AC is right - Commissions means you get paid either on the retail price or the volume of transactions. You don't care if you client makes money or the store makes money- volume is key.
I don't know if trader got paid a commission or not - but he did get a slice of the profits. The idea is to align the broker's interest with the client's interest. Most brokers who operate under this principal get a very small part of their salary paid by commission and the majority of it paid by some kind of profit sharing.
If commissions (i.e the number of transactions) was key he probably would not have made such a huge unidirectional bet on the market. There are "better" was to illegally churn an account then this. It souds like he was reaching for the fence, hoping for a home run, where everything would be forgiven.
I saw nothing about insider trading in the article. I work for a financial institution and having my management monitoring my financial statements makes me all too knowledgeable on insider trading monitoring.
Which is why you often find them doing black market work or other illegal activity, if it isn't official income just money in your pocket it's very hard for a judge to reach. Say you get hit with a Jammie Thomas verdict of 1.5 million dollars, even at a moderate 2% interest that's $30k before you even start making down payments and it'd take you 30 years to pay down at $50k/year and you're not going to have $80k in free post-tax income. People just give up permanently and make whatever they can on the side, even crap pay is better than good pay that's going straight down an endless hole. If you wanted more people to pay them back you need to give them some kind of incentive or a kickback for at least paying something back.
Live today, because you never know what tomorrow brings
He's not a broker so how commission is calculated for a broker is irrelevant. Percentage of sales makes no sense for a trader, you aren't trying to motivate them to buy and sell their purchase limit in the same stock as many times as they can each day after all.
A broker can't lose money on a sale - having them buy a stock for you earns them money, having them sell a stock for you earns them money. Out of that money they'll pay the broker his cut if he works on commission. The brokerage firm happen to call their cut "commission", but that's a very different usage of the word.
For a broker or clothing sales person there is no difference between profit and sales anyway - it just means the percentage number is going to be different (to factor in the profit margin).
Tell that to all the people getting rung up for illegal trades recently.
http://www.sec.gov/spotlight/insidertrading/cases.shtml
http://www.sec.gov/litigation/admin/34-43270.htm
http://en.wikipedia.org/wiki/2011_UBS_rogue_trader_scandal
The lawyer told him that the vast majority of bankruptcies are just as easy as his was (although that is just an anecdotal claim by his lawyer).
No offense but you're entire post was anecdotal. I've dealt with dozens of people looking to do the same thing and its never worked out for them. Perhaps your state is more prone to this type of abuse, mine however is not. I can speak anecdotally also. I once looked into it myself during the dot com bubble crash. After speaking with several lawyers, I was informed by each and every one of them that I was fucked. I'm guessing that your friends situation was specific to your state.
Let's round up to 10 years, just to make it easy. I currently work for less than $100k, but my quality of life is better than it would be in prison. Let's consider Prison in terms of something like working in a deployed/remote/somewhat hostile or dangerous location for extreme pay.
If I could steal, say, $5M, successfully hide 2.5M, 'returning' the rest that I didn't 'gamble away' as a sign of regret, whatever, so I only get 10 years.
$2.5M is $250k per year in prison, and assuming a 'moderate' 4% return while it's hiding in a Swiss or Caymen Islands account, it'll be $3.5M when I get out, giving me $140k/year to live off of, or almost double what I make now.
In other words if you're going to steal, go large. It's not worth it for anything less than 'millions' for middle class and up types.
I don't read AC A human right
Every time you hear a politician talk about the government "investing" in something, it's usually actually a loss. They gain reelection based on "broken window" fallacies.
Gamingmuseum.com: Give your 3D accelerator a rest.
There are two different types of bankruptcy that most private debtors go through. Chapter 7 of the bankruptcy code allows for most debts to be discharged but typically it is more difficult to qualify for that type of proceeding. Chapter 13 allows for restructured debt and in recent years, federal regulations make this the most common form allowed by bankruptcy courts.
Perhaps your friends both qualified for Chapter 7.
Charter Member of The Committee Group For The Elimination And Eradication Of Repetitive Redundancy
"which ultimately led to the demise of the financial services firm he worked for."
The company went bankrupt, which is as much as a company can be punished. Something this negligent requires punishment on both the individual and the company -- there just aren't enough consequences a company can impose on their employees beyond firing them to prevent something like this.
Option 3: Tell the SEC yourself and turn him in so he takes all of the blame. Considering the SEC can't unwind trades, the firm keeps the profits and doesn't have to pay the trader's commission.
Maybe, MAYBE they get a fine, but considering the SEC would want to encourage the self-policing, I doubt it.
But the complete loss of the trading company's reputation evaporates; running them out of business anyhow.
I'm a good cook. I'm a fantastic eater. - Steven Brust
So, lets see, in your examples, there's one big case (the UBS trader), another guy caught after *losing* giant chunks of money. The rest are "insider trading" cases, unrelated to the problem of policing crazy risky "unauthorized" trades within investment firms (and the associated types of fraud that the guy in the article got nailed for). Yes, the SEC can nail particularly stupid company insiders who tell their country club pals to buy right before the big corporate press release. However (and maybe I'm missing some in the giant laundry list of irrelevant examples you've provided), I don't see much evidence of ability to regulate (either by audits or firms turning in their own traders) against events like the one in this article (except where the gambler wins).
You know you have screwed up on a truly grand scale when you not only end up in prison (which isn't particularly hard nowadays), but also manage to completely destroy the company you work for, all in the same step. (Impressive for a non-executive anyway, CEOs do this sort of thing on an almost daily basis)
The problem with these perversities, is that when it IS so easy for someone to get away with shit in bankruptcy, this triggers financial problems for their creditors; who had to eat that shit. It causes a chain reaction. So - while I am not really happy with the 2005 re-write of the bankruptcy code, in general - I think that there are plenty of cases where it didn't go far enough.
These are my friends, See how they glisten. See this one shine, how he smiles in the light.
I make money the old-fashioned way, I mune it.
You're not discounting sleep. Lets assume you spend 8 hours unconscious a night. That may be generous, but you're also wasting time commuting, etc.
Assuming neither prison, or your current job, count as "quality time", and you spend 8 hours a day working. (8 * 5 = 40). And assume that if you commit a white-collar crime with an 8 year sentence, you'll have sufficient capital to retire on, in a style that you'd enjoy.
That leaves you with 8 hours quality time per day, which is really what you're giving up when you go to prison. Trade that for being able to have 16 hours quality time a day when you get out.
Assume you do the crime at 30, and you would have worked to age 65, so 35 year span.
16 * (35 - 8) = 432 (27 years of 16 hours a day quality time)
vs
8 * 35 = 280 (35 years of 8 hours a day quality time and 8 hours work)
So you get MUCH more quality time until retirement age via the white-collar-crime method. The only possible downer is that you may value the time you spend between 30 and 38 more than the time you have later. The other factor would be that if you enjoy your job, you're giving up a lot of quality time.
This is one reason why "insider trading" is such a major crime, and what ultimately nailed Martha Stewart
No. She got nailed with "lying to federal investigators". If she said she got some information that she should sell stock from her adviser, she would have got nothing. She wanted to protect the adviser, while the adviser sold her out in a plea bargain.
The moral of the story, don't try to cover the ass of someone else or it will be you that will be shat on.
Seems like he did us a favor...
I throw away many more years than that going to work every day. At least he had a chance of not having to work again.
I don't think so. If some trader endangered my entire firm's existence with a rogue trade, I would fire him regardless if it all worked out. He must have had some plan to steal all the proceeds without them knowing.
Maybe you are not a crook and not trying to take advantage of the system. That does not mean others are not. My wifes co-worker has an illegal immigrant husband. She bought a house and car and had a lot of debt. She gave up paying for everything and her husband followed up and bought a house and car. They moved into that house and rented out their first house that was in default for well over two years until the renters were finally kicked out and they stopped paying rent. That rent money was paying for the mortgage on his house (along with about 6 other people living in it paying rent). Oh yeah, since her husband is an illegal, she files taxes as single head of household and claims both her kids. She gets all of her income tax back + EIC + food stamps + kids free lunch at school + her kids get free medical care. They are driving a 2011 Acura TL and a 2012 Tacoma pickup truck. They have both filed for bankruptcy in the last 5 years and they are somehow still able to buy houses and cars. Her sister bought a house and took some type of first time buyer tax break/credit and then rented it out to a group of people. She only made a few payments on it and it is in default and she is still collecting rent. She lives with her husband in the house he bought. I have no idea if they are paying for that or not. Both of them have filed for bankruptcy in the last 5 years as well. When you have very little ties to the area and to the society you live in, you don't care about being a responsible person. I have no doubt this pattern is repeated over and over again by the same people and many others. When all else fails, you just pick up and move somewhere else.
Well, before being imprisoned he was a trader. If he does any productive work from prison at all, it's probably a net gain for the economy.
Just because you're paranoid doesn't mean there isn't an invisible demon about to eat your face
The lawyer told him that the vast majority of bankruptcies are just as easy as his was (although that is just an anecdotal claim by his lawyer).
No offense but you're entire post was anecdotal. I've dealt with dozens of people looking to do the same thing and its never worked out for them. Perhaps your state is more prone to this type of abuse, mine however is not.
An anecdotal prediction to the GP's anecdote.
After 7 years you are allowed to borrow again, but you dont have a clean slate. That bankruptcy would be on their records for life, any semi-responsible lender would be very reluctant to lend to them again. Getting a car loan from all but the shonkyest of the shonky would be difficult and even after declaring bankruptcy, if you get any money you can still be sued for it. As another poster has said, the scope of a bankruptcy is very narrow.
Calling someone a "hater" only means you can not rationally rebut their argument.
No offense but you're entire post was anecdotal. I've dealt with dozens of people looking to do the same thing and its never worked out for them.
My experience was anecdotal, but there is plenty of statistics that back up that most bankruptcies are quite easy and almost everything is dischargeable.
According to uscorts.gov the average bankruptcy has $115k in assets and $211k in liabilities. $202,361 of that debt is discharged on average, or almost 96%. That means in your average bankruptcy, someone who owes $211k will still owe $9000 by the end of the bankruptcy. That $9k is usually student loans, domestic support obligations, and taxes.
People still lose any assets that they have significant amount of equity in, such as a house or car. But you can always keep a house or car if you don't have too much equity (less than $30k in your home equity for a couple in IL, $100k in CA).
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
Perhaps your friends both qualified for Chapter 7
Yes they were both Chapter 7, the most common form of bankruptcy. 70% of bankruptcies are chapter 7, and 97% of these are non-business so business related bankruptcies are not skewing the numbers.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
I mean this isn't the first time.
He was able to buy $1 billion worth of stock, the eventual loss for the firm was $5 million, which is half a percent of the invested amount... and they go under?? Their capitalization was less than 1:200?...
Never been to jail, have you?
Vote monkeys into Congress. They are cheaper and more trustworthy.
Probably depends on the prison, and how much you dislike/like sodomy. But in my opinion, in general, I would rather go to jail for 5 years, then have a 9-5 boring job for 40 years, earning peanuts besides.
Troll is not a replacement for I disagree.
better than throwing away 40 for a shity retirement plan that your CEOs sell out from under you, while they buy themselves new 100 foot yachts with their bonuses.
Troll is not a replacement for I disagree.
And I think it really depends. They have books in Prison I think, and you gets load of opportunity for conversations and friends. You can even buy drugs, and I imagine liquor.
So in some ways you are not that badly off.
Depending on the book selection, I would not mind taking the next 8 years off to catch up on my reading.
Troll is not a replacement for I disagree.
Put a cap on market capitalization of big/listed companies
Casteism