As expected, Martin Druffner, a former broker with Prudential Securities, pled guilty Monday to four counts of wire fraud and four counts of securities fraud for illicit market timing. He now faces up to 20 years in jail, to be determined in a Dec. 12 sentencing hearing.
Druffner "recognizes that he made some mistakes in his career at Prudential and hopes to start his life anew," his attorney, Michael Collora, told Reuters. He added that Druffner is cooperating with investigators in hopes of more lenient sentencing. U.S. Attorney Michael Sullivan charged Druffner with reaping $1 million in commissions through $1.3 billion worth of market-timing trades on behalf of a hedge fund client.
Last month, Druffner's colleague Skifter Ajro also pled guilty to market timing. He is scheduled to appear in court for his sentencing on Nov. 2, at which he will face between 13 and 20 months in jail.
The SEC first charged Druffner, Ajro and four other Prudential executives with repeatedly timing the market in late October 2003. The SEC's civil charge contended that branch manager Robert Shannon and brokers Justin Ficken, John Peffer and Marc Bilotti were also in on the act.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.