U.S. Securities & Exchange Commission
SEC Seal
Home | Previous Page
U.S. Securities and Exchange Commission

Distributions Begin to Victims of Improper Trading at NYSE Specialist Firms


Washington, D.C., July 19, 2006 - The Securities and Exchange Commission announced that starting today the fund administrator will begin making distributions to compensate customers who were injured by the unlawful proprietary trading conducted by seven New York Stock Exchange specialist firms. The distribution funds include approximately $247 million in disgorgement and civil monetary penalties paid by the firms to settle charges of unlawful proprietary trading brought by the SEC. The first distribution includes payments totaling approximately $52 million.

"Today's distribution exemplifies the SEC's continuing commitment to investor restitution," said SEC Chairman Christopher Cox. "The substantial monetary remedies imposed in this case will compensate injured customers as well as deter future misconduct. It will also remind investors that the SEC continues to keep a close eye on market participants to ensure that markets function properly."

On March 30, 2004, and July 26, 2004, the SEC brought settled administrative proceedings against Bear Wagner Specialists LLC, Fleet Specialist, Inc. (now Banc of America Specialist, Inc.), LaBranche & Co. LLC, Spear, Leeds & Kellogg Specialists LLC, Van der Moolen Specialists USA, LLC, Performance Specialist Group LLC, and SIG Specialists, Inc. Pursuant to the settlement orders, the firms paid over $247 million to compensate injured customers.

The settlement funds were deposited into seven Fair Funds that are being administered by a single fund administrator, and will be distributed pursuant to a distribution plan drawn up by the fund administrator. The fund administrator's distribution plan was approved by the SEC on May 17, 2006, and subsequently modified on July 5, 2006. By distributing the money under a single distribution plan, administrative costs are substantially reduced.

The fund administrator responsible for distributing the settlement funds paid by the Specialist Firms to compensate injured customers is Heffler, Radetich & Saitta L.L.P. (Heffler), P.O. Box 940, Philadelphia, PA 19105-0940. Questions regarding the distribution may be directed to Heffler at 215-972-5071.

# # #

For further information contact:

David Rosenfeld
Associate Regional Director, Northeast Regional Office

  Additional Materials:

Distribution Plan:

Settlement Orders:



Modified: 07/19/2006