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Thursday, March 28, 2024 | Back issues
Courthouse News Service Courthouse News Service

Three Traders Face|Securities Fraud Charges

(CN) - Three former Nomura Securities International traders have been indicted on charges that they lied to consumers to reap millions from mortgage-backed bonds in the wake of the global financial crisis, the U.S. Securities and Exchange Commission announced Monday.

Ross Shapiro, Michael Gramins and Tyler Peters, who had worked for the New York-based securities firm since 2009, were charged in an indictment filed in the Federal Court in New Haven, Connecticut.

It is not clear from court documents when the men left Nomura's employment.

All three men are expected to be arraigned on Thursdays. Their attorneys were not immediately available for comment.

According to court documents, the three men conspired to defraud customers to generate millions in additional revenue for their employer.

Prosecutors say in perpetrating their scheme, Shapiro, Gramins and Peters repeatedly inflated and deflated the prices of mortgage-backed securities in order to induce customers to either pay more than they were worth or to sell them for less than they were worth.

They also claim the three men trained their subordinates to lie to customers, provided them with the language to use in deceiving customers, and encouraged them to do so.

The three men are also accused of creating fictitious third parties to increase their profits, and colluded with at least one outside client deceptively engage in trades on their behalf.

In a statement, Deirdre Daly, the U.S. Attorney for Connecticut, said they three men engaged in their allegedly illicit activities for several years, and "handsomely profited by repeatedly lying to Nomura's customers in violation of federal law."

In addition to the criminal charges, the SEC also filed a civil complaint against the three men in Manhattan Federal Court.

Shapiro is represented by Guy Petrillo of Petrillo Klein; Gramins is represented by Marc Mukasey of Bracewell Giuliani; and Peters is represented by Brett Jaffe at Alston & Bird. All three firms are located in New York.

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