Securities Industry Commentator by Bill Singer Esq

December 20, 2017

Jon-Jorge Aras, Esq. joins Levan Legal, LLC.
Up and coming securities-industry lawyer Jon-Jorge Aras has joined prominent industry lawyer Richard Levan at Levan Legal, LLC Aras represents securities industry professionals and firms in enforcement actions and investigations initiated by the United States Securities and Exchange Commission and FINRA, among others. Aras litigates in federal and state court, administrative forums and in arbitration and mediation settings. Aras can be reached at or by phone at 484-431-0250.

Second Circuit Reinstates BATS HFT Class Action ( Blog)
After Michael Lewis published "Flash Boys," the world awoke to a very dire picture of high frequency trading ("HFT") and its corrosive and corrupting influences on the so-called level playing field that Wall Street so dearly wants to market to the public. The fact is -- and this is coming from a 35-year industry veteran -- there has never been a level playing field in the financial markets. They want you to believe that fairy tale. You may actually believe it. But the truth is that the cards are often marked, the wheels are rigged, the dice loaded, and the House retains the odds (and, yes, there are more than a few professional cheaters who make a nice living operating on the fringe). Sorry to burst your bubble. All of which set the stage for the filing of a number of lawsuits about the fraud perpetrated via HFT and how more than a handful of self-regulatory organizations ("SROs") seemed to have either looked askance or, worse, engaged in complicit behavior. READ

Broker Charged With Giving Special Access to IPOs for Cash Kickbacks
(SEC Release) The Securities and Exchange Commission today charged Brian Hirsch with subverting allocation policies and procedures at two brokerage firms where he worked on the wealth syndicate desk. The U.S. Attorney's Office for the District of New Jersey has filed parallel criminal charges against Hirsch. As set forth in part in the SEC Release, Hirsch allegedly made:

long-running arrangements with certain customers to give them larger allocations of coveted public offerings being marketed by the firms.  In most instances, the customers sold their stock into the market as soon as possible to turn a substantial profit at the expense of the firms' other brokerage customers and the issuers' interests in raising capital from long-term investors.

Also charged in the SEC's Complaint is Hirsch's customer Joseph Spera, who allegedly made approximately $4 million in trading profits on the offering allocations he received from Hirsch.  Spera allegedly paid Hirsch approximately $1 million in cash. READ the FULL TEXT SEC COMPLAINT

Georgia Real Estate Investor Sentenced to 16 Months in Prison for Bid Rigging and Bank Fraud at Public Foreclosure Auctions (DOJ Press Release) After a two-week federal trial, Douglas L. Purdy was convicted of bid rigging and two counts of bank fraud. Purdy was sentenced to 16 months in prison with three years supervised release, and ordered pay $81,979.86 in restitution to victims. Purdy and his co-conspirators agreed to not to compete for residential real estate at foreclosure auctions in Forsyth County, Georgia and defrauded lender banks and homeowners via such activity as secret "second auctions" of properties, dividing among themselves the auction proceeds that should have gone to pay off debt against the properties and, in some cases, to homeowners.