Ex-Fiserv Broker Settles Market TimingCharges
WASHINGTON - (04/11/06) -- A former broker for FiservSecurities agreed to pay $100,000 and to be barred from thesecurities industry in order to settle charges of market timing,the Securities and Exchange Commission announced Monday. ThomasGerbasio, who headed Fiserv Securities New York office until April2004, settled the charges without admitting or denying guilt.Fiserv Securities was sold last year to Fidelity Investments, whichwound down the business last month. The SEC charged that FiservSecurities placed tens of thousands of market timing trades forselect hedge funds and claimed Gerbasio defrauded hundreds ofmutual funds and their investors by using sophisticated methods tocircumvent SEC rules on market timing. The methods includedmisrepresenting the nature of the trades to the funds, openingdozens of accounts on behalf of their customers to conceal theiridentity from the funds, entering trades in amounts that wouldavoid detection, and advising their customers on strategies toconceal the market timing from funds that objected to the scheme. Ayear ago Fiserv agreed to pay $15 million to settle charges ofimproper mutual fund trading. Gerbasio was ordered to repay$540,000 in illegal profits, but all but $100,000 of the repaymentwas waved under the final judgement.