Date of Birth: 11/12/1916
Date of Death:
07/18/2004
Age at Death: 87
Cause of Death: Heart failure
Short Interview with Richard Ney:
http://www.hermes-press.com/neyint.htm
Obituaries of the famous and the infamous:
http://www.lifeinlegacy.com/
Bio's of the famous & their families:
http://www.nndb.com/
Obit, revealing lives:
http://obit-mag.com/
The Dead Rock Stars Club:
http://users.efortress.com/doc-rock/2005.html
For six years in the mid 1980's, Richard (Maximilian) Ney wrote "The Ney Report,"
a hard hitting stock market newsletter, wherein he would expose market
manipulation by NYSE Specialists aided and abetted by the SEC and other
insiders.
He received much attention for "The
Wall Street Jungle" (1970), "The
Wall Street Gang" (1974), and "Making
it in the market: Richard Ney's low risk system for stock market
investors"
(1975) books that criticized market specialists on the stock exchange
floor and what he considered a complacent regulatory body, the
Securities and Exchange Commission. He also became an early advocate
of electronic placement of "buy" and "sell" orders.
... and decades later, these are the headlines:
http://www.businessweek.com/ap/financialnews/D89DUCIO0.htm?campaign_id=apn_home_down
APR. 12, 2005, 11:16 A.M. ET Twenty specialists who managed trades on
the floor of the New York Stock Exchange were indicted Tuesday,
charged with fraudulent and improper trading practices by the Justice
Department. The Securities and Exchange Commission filed civil charges
against the specialists as well.
The SEC's division of inforcement said that between 1999 and mid-2003,
specialists at five firms put their firms' orders ahead of customers'
orders, causing those customers to get inferior prices.
http://quote.bloomberg.com/apps/news?pid=10000006&sid=as_5ShkZcKx4&refer=home
April 12, 2005 (Bloomberg) -- Fifteen New York Stock Exchange
specialists, the traders responsible for keeping an orderly market on
the world's biggest stock exchange, were indicted for fraudulent and
improper trading.
In the biggest federal crackdown on illegal trading at the NYSE since
1998, the U.S. Attorney's Office in Manhattan will announced the
charges this morning with representatives from the FBI and Securities
and Exchange Commission. Indicted are current and former employees of
firms including LaBranche & Co., Van der Moolen NV, Bear Wagner
Specialists, Goldman Sachs Group Inc.'s Spear Leeds & Kellogg and Banc
of America Specialist.
The charges stem from a two-year probe of specialists, who match by
and sell orders on the floor of the exchange and trade for their own
accounts. The NYSE's seven
specialist firms last year agreed to pay $247 million to settle
allegations that they profited on trades at the expense of their
customers.
``To see criminal activity on the floor is really astounding,'' said
Jacob Zamansky, a New York lawyer who represents investors in
arbitrations against brokers. ``This occurred under the watch of the
NYSE. It raises questions about whether the NYSE can properly
supervise the people there.''
If convicted, the specialists face a maximum of 20 years in jail on
each count of securities fraud and fines of $1 million to $5 million.
``These defendants broke the rules repeatedly,'' U.S. Attorney David
Kelley said at a press conference.
Indicted Specialists
Former Van der Moolen Senior Managing Partners Joseph Bongiorno and
Patrick McGagh Jr., Frank Delaney of Bear Wagner and LaBranche's
Freddy DeBoer are among the specialists indicted.
The NYSE's other specialist firms are SIG Specialists Inc. and
Performance Specialist Group. The exchange first said in April 2003
that it was investigating the firms to determine whether they
illegally traded stocks ahead of their clients.
Kelley, the SEC and the NYSE have been investigating individuals in
connection with the violations.
In a statement, Kelley said the indicted specialists violated federal
securities law ``through patterns of fraudulent and improper trading
over approximately four years.'' He didn't name the individual
specialists or the firms they worked for.
The U.S. Department of Justice first targeted illegal trading on the
NYSE in 1998, when it charged eight floor brokers and two executives
of Oakford Corp.
http://www.cfo.com/article.cfm/3855350?f=home_breakingnews
SEC Passes ''Trade-Through'' Rule
Both issuers and investors,
however, may face some turbulent times as the New York Stock Exchange
makes a transition to a hybrid trading model.
Stephen Taub and Craig Schneider, CFO.com
April 08, 2005
The Securities and Exchange Commission voted 3-to-2 late yesterday to
require that all investor trades be executed at the best price, even
if stock markets must fill the order through a competitor.
SEC Chairman William Donaldson once again cast the deciding vote on an
issue that was opposed by his two fellow Republican commissioners,
according to published reports. "We're attempting through new rules to
protect the concept of best bid to be honored in the marketplace," he
said in an interview on the Fox News cable channel
The "trade-through'' rule part of Regulation National Market
Structure (Reg NMS) is a watered-down version of an SEC proposal
from late last year and is widely deemed a victory for the New York
Stock Exchange, which Donaldson once headed, according to The Wall
Street Journal. The earlier version would have trivialized the role of
the NYSE's specialists, the paper noted. The floor-based trading
specialists of the American Stock Exchange also already adhere to the
rule
On the other hand, added the Journal, market pros deem the big losers
to be electronic exchanges such as the Nasdaq Stock Market. The Nasdaq
had hoped that the SEC would allow investors to trade on whichever
market they chose, even if it didn't offer the best price for
example, if investors were more concerned with speedy execution of
their orders.
When the SEC considered revisions to the trade-through rule, according
to The New York Times, it determined that investors should be able to
bypass "slow markets," even if those markets had better prices. In
response, noted the paper, the NYSE announced that it would update its
systems to enable automatic best-price execution which then
qualified the Big Board as a "fast market" that could not be
sidestepped. Those NYSE changes are scheduled to take effect next
spring, added the Times, when Reg NMS will begin to be phased in.
In a December interview with CFO.com, Steve Braverman, managing
director at consultancy Tahoe Advisors, said he believes that the NYSE
will have a tricky balancing act as it makes a transition to a hybrid
trading model. By his lights, if more orders begin to flow through
NYSE's electronic system and specialists are restricted in how much
they can trade for their own accounts there's a greater chance that
those specialists could become disengaged.
In the near term, that could be risky for both issuers and investors.
Braverman explained that if specialists' earnings decrease as a result
of structural changes in the market, they may lose the incentive to
invest capital as often, allowing forces of supply and demand to drive
stock prices more freely. "That will lead to more volatility,"
he said, and potentially cause major investors to balk at taking
positions for fear of moving the market too much without specialist
support in times of market stress.
In a statement, Sen. Richard Shelby (R-Ala.), the chairman of the
Senate Banking Committee, decried the 3-to-2 vote as a reinforcement
of "what appears to be a disturbing trend of actions that have
resulted in split decisions," according to the Journal. Shelby added
that "splits dilute the actions of the commission and undermine their
authority to speak as a unified body."
Donaldson's two fellow Republican commissioners, Cynthia Glassman and
Paul Atkins, were outspoken opponents of the new rule. Glassman called
it a "massive regulatory intrusion into the operation of the markets
that limits investor choice and impedes innovation and competition,"
according to the newspaper.
This is the latest rule passed by the SEC on the support of the two
Democratic commissioners, Harvey Goldschmid and Roel Campos, including
new governance rules for mutual funds and the hedge fund registration
requirement. Donaldson also supports the now-languishing proxy access
rules, which are also opposed by the Glassman and Atkins.
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