Phoenix-based
Former officers, including CEO Grant D. Seeger and President William A. Kenyon, were named in the suit, which alleges that a group of related hedge funds, the Canary Capital funds, were allowed to trade improperly and sometimes illegally under the top officials watch. Canary Capital, controlled by Edward J. Stern, has already settled another charge with Spitzers office for $40 million stemming from trades with, among others,
Among other transgressions, the SECs charges contend that between May 2000 and July 2003, 99% of Security Trusts trades with Canary took place after the 4 p.m. deadline.
Stephen M. Cutler, director of the SECs enforcement division, said the investigation involved Spitzers office, the
"Today's important action was a product of swift investigation and effective cooperation by federal and state agencies alike," Cutler said. Ex-Security Trust SVP for Corporate Services Nicole McDermott was also named in the fraud suit.
