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DOJ Swings & Misses; SEC On Deck

Specialists Win in Court Again

Traders Magazine, October 2008

Peter Chapman

This summer brought some good legal news for a bunch of ex-New York Stock Exchange specialists. In July and August, federal judges exonerated six former NYSE specialists charged by the U.S. Department of Justice (DOJ) with securities fraud for their roles in the NYSE floor trading scandal in the early years of the decade. The judges' decisions offer hope to several others now facing trial in Securities and Exchange Commission proceedings covering the same charges. (Many also face hearings conducted by the New York Stock Exchange; see related story.) The U.S. Court of Appeals for the Second Circuit got the ball rolling in July, when it rejected the DOJ's appeal of a ruling by Federal Judge Dennis Chin in February 2007 that found former specialist David Finnerty not guilty of securities fraud.

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