Three former brokers, who were first with UBS Financial Services Inc. and then with Merrill Lynch & Co. Inc., have been barred from working in New Jersey.
Three former brokers, who were first with UBS Financial Services Inc. and then with Merrill Lynch & Co. Inc., have been barred from working in New Jersey, state Attorney General Anne Milgram announced yesterday.
The state's securities bureau revoked the registrations of Christopher Chung, Kevin Brunnock and William Savino, keeping them from issuing, selling, purchasing or distributing any securities in New Jersey, following a finding that the three had participated in market timing trades in mutual funds. Collectively, the three have been fined $1.15 million in civil penalties.
The state regulators alleged that while working for New York-based UBS in 2001, Mr. Chung and Mr. Savino paired up to provide investment services to Millennium Partners LP, a New York hedge fund. Mr. Brunnock later joined the duo.
The three men used multiple accounts, financial adviser numbers and office branch codes to hide their activities, according to the New Jersey authorities. The three left UBS and went to Merrill Lynch, both in New York, bringing the Millennium account with them. They were at Merrill from January 2002 to October 2003, where, they continued their timing activities, according to authorities. The men also avoided paying fees that mutual funds charge for shares that are held for a short period of time by moving shares between accounts before selling them, authorities said. To settle the New York Stock Exchange's and state regulators' claims of failure to supervise employees, UBS paid $54 million in 2006, while Merrill paid $13 million in 2005.
The three men agreed to the fine without admitting or denying the findings.
