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NEW YORK (CNN/Money) -
A former clerk for a New York Stock Exchange floor broker was charged with securities fraud today by the SEC for his role in a trading scheme.
The former Jefferies Execution Services Inc. employee, Frank J. Furino, allegedly tipped a day trader about pending, large, block stock orders on behalf of his firm's institutional customers. The day trader was able to trade those stocks before these large customer orders were executed and profit from short-term price movements, according to the SEC's civil complaint filed in the U.S District Court in Brooklyn, N.Y.
Between August 2000 and December 2001, the day trader, who was not indentified in the complaint, netted over $300,000 in trading profits on at least 58 trades, while Furino pocketed payments ranging from $2,500 to $10,000 per month from the day trader, the SEC charges. Until his recent termination, Furino, 48, was employed on the floor of the New York Stock Exchange as a clerk for a floor broker, Jefferies Execution Services Inc. and its predecessor, Lawrence Helfant LLC.
The SEC complaint also states that Jefferies Execution Services' customers suffered losses because the scheme enabled the day trader to trade at more favorable prices than the customers received.
The New York Stock Exchange Inc. is also filing today an action against Furino, charging him with securities fraud and violation of NYSE rules.
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