Corporate & Securities Law

By Jim Hamilton

Bogus Account Statements Admissible Against Broker

The 2nd Circuit affirmed a broker's fraud conviction, rejecting the defendant's objection to the introduction into evidence at trial of phony account statements issued to customers. The broker claimed the statements should not have been considered at trial because the statements were sent after the purchases of the securities and were not made in connection with the purchase or sale of securities. While the court conceded that the use of the statements was not in itself sufficient to establish a securities law violation, the use of such statements was relevant as evidence of the defendant?s intent to defraud and the extent of the scheme employed.

The opinion in U.S. v. Kelley may be found here.

Full post as published by Jim Hamilton's World of Securities Regulation on January 07, 2009 (boomark / email).