Thursday, 24 July 2014
Last updated 15 min ago
May 14 2008 | 9:10am ET
The first criminal mutual-fund market-timing case had made a former hedge fund broker the first to be sent up the river in the scandal that rocked the hedge fund and mutual fund worlds.
Thomas Gerbasio, a former Philadelphia-based registered representative, was sentenced to one year and one day in prison for his role in helping hedge fund Beacon Rock Capital engage in tens of thousands of fraudulent market-timing trades. Gerbasio helped design a strategy to allow Portland, Ore.-based Beacon Rock, which closed its hedge fund business in 2003 and has since split and rechristened itself the Beacon Investment Group, to skirt market-timing and trading limits imposed by mutual funds.
For its role in the scheme, Beacon—which pleaded guilty to one count of securities fraud last year—was sentenced to three years’ probation and will pay more than $1 million in forfeitures and fines. Gerbasio received two years of supervised release and was order to pay a $7,500 fine.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…