News Releases

NEW YORK, June 25, 2003 - The New York Stock Exchange has taken disciplinary actions against four member firms and 20 individuals for violations of NYSE rules and federal securities laws. The cases, prosecuted by the NYSE Division of Enforcement, may be subject to review by the Securities and Exchange Commission and, thereafter, federal courts.

Member Firms Disciplined for Violating NYSE Market-on-Close and/or
Limit-on-Close Order Entry and Cancellation Policy

Banc of America Securities, LLC of San Francisco, Calif., a member firm, consented without admitting or denying guilt to a finding that it violated NYSE market-on-close (MOC) and limit-on-close (LOC) order entry and cancellation requirements.

• An NYSE hearing panel found that, during the period February 2001-February 2002, the firm entered 84 MOC/LOC orders, which did not offset a published imbalance, after the 3:40 PM cut-off time; cancelled 142 MOC/LOC trades between 3:40 and 3:50 PM, when such trades did not involve instances of legitimate errors; and cancelled 98 MOC/LOC trades after the 3:50 PM cut-off time.

The NYSE imposed a penalty of a censure and $75,000 fine. Banc of America consented to the penalty.

Salomon Smith Barney Inc. of New York City, a member firm, consented without admitting or denying guilt to a finding that it violated NYSE market-on-close (MOC) order entry and cancellation requirements.

• An NYSE hearing panel found that, during the period May-November 2002, the firm -- after the cut-off times for entry and cancellation of MOC orders -- cancelled 112 MOC orders and entered 15 MOC orders that did not offset published imbalances. The panel found that the violations included cancellations of MOC orders on expiration
  Fridays in July and November 2002.

The NYSE imposed a penalty of a censure and $65,000 fine. Salomon Smith Barney consented to the penalty.

Member Firm Disciplined for Net Capital, Books-and-records and Supervisory Deficiencies

Gerard Klauer Mattison & Co., Inc. of New York City, a member firm, consented without admitting or denying guilt to findings of net capital, books-and-records and supervisory deficiencies.

• An NYSE hearing panel found that, on Oct. 26, 2000, in anticipation of receiving a large purchase order from another broker-dealer, the firm accumulated a stock position intra-day without sufficient net capital to do so, resulting in an intra-day net capital deficiency of approximately $19.5 million. As a consequence of this, the panel found that the firm did not maintain its net capital at required levels while conducting its securities business, did not reasonably supervise its compliance with moment-to-moment net capital requirements, and did not accurately record the terms of the order from the broker-dealer when it was received.

The NYSE imposed a penalty of a censure and $75,000 fine. Gerard Klauer Mattison consented to the penalty.

Member Firm Disciplined for Supervisory, Reporting, Operational and Books-and-records Deficiencies

Stifel, Nicolaus & Company Incorporated of St. Louis, Mo., a member firm, consented without admitting or denying guilt to findings of supervisory, reporting, operational and books-and-records deficiencies.

• An NYSE hearing panel found that, at various times during 1998-2002, the firm failed to establish and maintain appropriate procedures for supervision and control, and failed to reasonably supervise with respect to: the business activities of the firm's broker on the trading floor of the Exchange, timely filing of accurate Forms RE-3 and amended Forms U-5; preventing employees with inactive registrations from performing duties and functions requiring registration; approving and reviewing certain employee-related accounts held outside the firm; obtaining Exchange approval for various officers and directors to be allied members; and submitting to its clearing agent accurate account type indicators for certain transactions. The panel found that the firm also failed to receive all commissions of its floor broker, failed to properly accrue commissions received from its floor operations and failed to preserve certain required books and records.

The NYSE imposed a penalty of a censure and $50,000 fine. Stifel Nicolaus consented to the penalty.

Former Member Disciplined for Improper Intra-Day Trading

Davis Margold of Darien, Conn., a former Exchange member, consented without admitting or denying guilt to findings that he engaged in intra-day trading that was improper, among other violations.

• An NYSE hearing panel found that, from approximately 1996-February 1998, Margold executed trading-for-eighths orders for a non-member firm. The panel found that on at least ten trade dates, Margold used buy minus and sell short orders he simultaneously held to effect trades for the firm without obtaining a new liquidating or covering order. The hearing panel also found that Margold recorded executions on the wrong order tickets and made changes to the information on original order tickets.

The NYSE imposed a penalty of a censure and $50,000 fine. Margold consented to the penalty.

Individuals Disciplined for Sales Practice Misconduct and Other Violations

Hyrum Kenneth Bond, Jr. of Mesa, Ariz., a former registered representative, consented without admitting or denying guilt to findings that he engaged in sales practice misconduct in the account of one customer.

• An NYSE hearing panel found that, during the period February 2000-June 2001, Bond effected unsuitable equity and options transactions in the account of one customer, an elderly widow who relied on him for investment advice. The panel found that certain of the options trades were effected on a discretionary basis.
  
  
• The hearing panel also found that, in December 1999, Bond borrowed $15,000 from the customer without disclosing the loan to his member-firm employer and that, beginning in 2000, he also shared in the profits from certain transactions in the account and, on at least one occasion, forwarded unapproved correspondence to the customer.

The NYSE imposed a penalty of a censure and two-year bar. Bond consented to the penalty.

Kenneth G. Lundin of Phoenix, Ariz., a former registered representative, consented without admitting or denying guilt to findings that he engaged in sales practice misconduct in the accounts of seven customers.

• An NYSE hearing panel found that, during a two-week period in October 2000, Lundin effected a total of approximately 14 unauthorized transactions in five customers' accounts. The panel found that the transactions were unsuitable for four of the customers, in view of their financial resources, investment objectives, the size of the transactions and the risk characteristics of the securities.
  
  
• The hearing panel found that Lundin's transactions also caused violations of Regulation T of the Federal Reserve Board since there was no reasonable expectation that the customers would pay for the transactions prior to selling out the positions and that, when the firm inquired about the transactions, Lundin made misstatements on error and trade correction forms. The panel also found that, during the period March-October 2000, Lundin effected excessive and unsuitable transactions in the accounts of two additional customers.

The NYSE imposed a penalty of a censure and nine-month bar. Lundin consented to the penalty.

Scot Robert Harris of Las Vegas, Nev., a former registered representative, consented without admitting or denying guilt to findings that he engaged in sales practice misconduct in the accounts of two customers.

• An NYSE hearing panel found that, from April 1999-February 2001, Harris caused his member-firm employer to fail to learn essential facts relating to the customers and caused inaccurate information to be entered into the records of his member-firm employer. The panel also found that Harris engaged in unsuitable trading in the customers' accounts.

The NYSE imposed a penalty of a censure and eight-month bar. Harris consented to the penalty.

Duane Alan Sheldon of Savannah, Ga., a former registered representative, consented without admitting or denying guilt to findings that he engaged in sales practice misconduct in the account of one customer and that he failed to cooperate in an investigation by the NYSE Division of Enforcement.

• An NYSE hearing panel found that during August 2000, Sheldon attempted to reimburse a customer of his member-firm employer $5,227 for losses in the customer's account and that, during March-October 2001, Sheldon failed to comply with Exchange requests that he submit a written explanation and provide testimony regarding certain matters that occurred prior to the termination of his employment at a member firm.

The NYSE imposed a penalty of a censure and five-month bar. Sheldon consented to the penalty.

Steven Lloyd Cronin of New York City, a registered representative, consented without admitting or denying guilty to findings that he engaged in sales practice misconduct in eight customer accounts, among other violations.

• An NYSE hearing panel found that, during 1997-March 1999, Cronin engaged in the following sales practice violations: exercising discretion without written authorization in seven customer accounts belonging to three customers; effecting unsuitable trades in four of the seven customer accounts; engaging in excessive trading in four of the seven accounts; and entering unauthorized trades and using margin without authorization in the eighth account. The panel also found that Cronin failed to keep current, and accurately update, his Form U-4.

The NYSE imposed a penalty of a censure, three-month suspension and $25,000 fine. Cronin consented to the penalty.

Linda Patrice Boeke of Wrightsville, Pa., a former registered representative, consented without admitting or denying guilt to findings that she engaged in sales practice misconduct in the accounts of 11 customers.

• An NYSE hearing panel found that, during the period 1998-2000, Boeke effected transactions in the accounts of eleven customers with the use of orally granted discretionary authority. The panel found that Boeke did not obtain the required written authorizations or the approval of her member-firm employer to use discretion as required by Exchange rules.

The NYSE imposed a penalty of a censure, three-month bar and $5,000 fine. Boeke consented to the penalty.

Patrick O'Leary Pascarella of Basking Ridge, N.J., a registered representative formerly with a member firm, consented without admitting or denying guilt to findings that he engaged in sales practice misconduct in the accounts of two customers.

• An NYSE hearing panel found that, from Oct. 1998-Feb. 1999, Pascarella effected unauthorized trades in accounts and, with respect to one of them, also effected unsuitable and excessive trades as well as discretionary trades without the customer's written authorization.

The NYSE imposed a penalty of a censure and three-month bar. Pascarella consented to the penalty.

Individual Disciplined for Charging Losses to Member Firm Without Authorization and Other Violations

Janice Marie Williams of Boston, Mass., a former registered representative, was found guilty of writing-off losses in her account and charging them to her member-firm employer without authorization and failing to cooperate in an investigation by the NYSE Division of Enforcement, among other violations.

• An NYSE hearing panel found that, during 2000-2001 and without authorization from her member-firm employer, Williams (a branch operations manager at the firm) wrote-off losses in her account on three occasions by either entering into the firm's computer system a "write-off" journal transaction or a cancellation of a trade due to a "billing error." The panel also found that Williams issued a check to pay for securities on one occasion when there were insufficient funds in her account to cover the check.
  
  
• The hearing panel found that Williams failed to comply with Exchange requests that she provide testimony concerning matters that occurred prior to the termination of her employment with a member firm.

The NYSE imposed a penalty on Williams of a censure and five-year bar.

Individual Disciplined for Making Electronic Credit Entries into Her Personal Brokerage Account Before Depositing Funds into Account

Angela Michelle Dickerson of Smyrna, Ga., a former registered representative, was found guilty of misusing her position at her member firm employer by causing entries to be made to her account permitting her to draw checks and make withdrawals on insufficient funds while delaying the deposit of funds into the account and for failing to cooperate in an investigation by the NYSE Division of Enforcement, among other violations.

• An NYSE hearing panel found that, during March-June 2000, Dickerson made or caused to be made credit entries, reflecting deposits into her personal brokerage account at the firm, in the firm's general ledger via the firm's computer system. The panel found that Dickerson then wrote checks and made withdrawals from her account, while delaying making the deposits of funds that corresponded to the credit entries.
  
  
• The panel also found that Dickerson failed to comply with a written request by the Exchange for information and testimony regarding matters that occurred prior to the termination of her status as an employee of a member firm.

The NYSE imposed a penalty on Dickerson of a censure and four-year bar.

Individuals Disciplined for Engaging in Unauthorized Outside Business Activities and Other Infractions

Roger Lynn Overby of Tampa, Fla., a former registered representative at two member firms, consented without admitting or denying guilt to findings that he engaged in an outside business activity without receiving prior written consent of his member-firm employers, and making misstatements and/or failing to disclose facts to his member-firm employers concerning his involvement or affiliation with an outside business.

• An NYSE hearing panel found that, from 1996-2000, Overby engaged in outside business activities involving a private medical technology corporation and one of its affiliates, without the knowledge or approval of his member-firm employers during the time period, activities for which he received compensation of $290,000 and stock options, which he exercised. The panel found that Overby also solicited customers of his member-firm employers, and other individuals, to invest in the corporation and its affiliate without disclosing to some of the customers his involvement in the outside business activities. The hearing panel also found that Overby made misstatements and failed to disclose facts to his member-firm employers concerning his outside business activities.

The NYSE imposed a penalty of a censure and nine-month bar. Overby consented to the penalty.

William Key Moors Goldsmith of Bloomfield Hills, Mich., a former registered representative, consented without admitting or denying guilt to findings that he engaged in an outside business activity without receiving the prior written consent of his member-firm employer, and making misstatements and/or failing to disclose facts to his member-firm employer concerning the outside business activity.

• An NYSE hearing panel found that, from late-1997-1999, without the knowledge of his member-firm employer, Goldsmith received approximately $118,000 in compensation from two investment funds in connection with the administrative and management duties he performed for them. The panel found that Goldsmith failed to disclose to the firm that he assisted in the administration and management of the funds and failed to disclose in any manner that he received compensation for work performed in connection with the funds.

The NYSE imposed a penalty of a censure and six-month bar. Goldsmith consented to the penalty.

Individuals Barred for Misappropriation and Other Violations

Delilah Rosa of Bronx, N.Y., a former non-registered employee of a member firm, consented without admitting or denying guilt to a finding that she misappropriated funds belonging to her member-firm employer.

• An NYSE hearing panel found that, during the period Feb. 12-Nov. 5, 2001, Rosa misappropriated $38,317 from her member-firm employer by: signing her supervisor's name to cash advance requisition reports ($11,500) and overtime reports ($15,771); by using corporate charge cards of other firm employees ($1,032); and using taxi vouchers for personal rather than business purposes ($10,014).

The NYSE imposed a penalty of a censure and permanent bar. Rosa consented to the penalty.

Stacie Dorfman of Freeport, N.Y., a former non-registered employee of a member firm, was found guilty of misappropriating customer funds and failing to cooperate in an investigation by the NYSE Division of Enforcement, among other violations.

• An NYSE hearing panel found that in 2001, Dorfman submitted a forged letter on three separate occasions involving two customers of her member-firm employer requesting that a check in the amount of $950 be paid out of the customer's account to Dorfman's landlord. Each of the checks was issued to the landlord and each was subsequently negotiated and as a result $950 was withdrawn from the customer's account.
  
  
• The panel also found that Dorfman failed to comply with a written request by the Exchange to provide a written explanation related to matters that occurred while she was employed by a member firm.

The NYSE imposed a penalty on Dorfman of a censure and permanent bar.

Shellie Leann Lockard of Oxnard, Calif., a former registered representative, consented without admitting or denying guilt to findings that she misappropriated customer funds, among other violations.

• An NYSE hearing panel found that in 2001, Lockard misappropriated a total of $2,650 from two customers of her member-firm employer by presenting letters of authorization (LOAs) to a branch office cashier that authorized the transfer of funds from the customers' accounts to Lockard. The panel found that Lockard also made misstatements to her member-firm employer and/or to a customer of her member-firm employer.

The NYSE imposed a penalty of a censure and permanent bar. Lockard consented to the penalty.

Individual Disciplined for Failure to Disclose Criminal History

Robert Daniel Comstock of San Francisco, Calif., a former non-registered employee of a member firm, was found guilty of failing to disclose his criminal history to his member-firm employer.

• An NYSE hearing panel found that Comstock failed to disclose on an employment application submitted to his member-firm employer a December 1996 misdemeanor conviction for false reporting, which subjected Comstock to a statutory disqualification, and a January 1999 plea of guilty to a felony drug charge.

The NYSE imposed a penalty on Comstock of a censure and four and a half year bar.

Individuals Barred for Failure to Cooperate

Quinto Perichon of Miami, Fla., a former registered representative, consented without admitting or denying guilt to findings that he failed to cooperate in an investigation by the NYSE Division of Enforcement.

• An NYSE hearing panel found that Perichon failed to provide on-the-record testimony regarding matters that occurred during the course of his employment as a registered representative of a member firm.

The NYSE imposed a penalty of a censure and bar until he complies with the Exchange's request, which will become permanent if he does not comply within three months. Perichon consented to the penalty.

Deborah Bowman of Pinebluff, N.C., a former registered representative, was found guilty of failing to cooperate in an investigation by the NYSE Division of Enforcement.

• An NYSE hearing panel found that Bowman failed to comply with a written request by the Exchange for testimony relating to conduct that occurred while she was employed by a member firm.

The NYSE imposed a penalty on Bowman of a censure and bar until she complies with the Exchange's request, which will become permanent if she does not comply within three months.

Richard Chandler Gray of Clarks Summit, Pa., a former registered representative, was found guilty of failing to cooperate in an investigation by the NYSE Division of Enforcement.

• An NYSE hearing panel found that Gray failed to comply with written requests by the Exchange for information concerning one or more matters that occurred prior to the termination of his status as an employee of a member firm.

The NYSE imposed a penalty on Gray of a censure and bar until he complies with the Exchange's requests, which will become permanent if he does not comply within three months.

David Coyle of Freehold, N.J., a former registered representative, was found guilty of failing to cooperate in an investigation by the NYSE Division of Enforcement.

• An NYSE hearing panel found that Coyle failed to comply with a written request by the Exchange to provide testimony concerning matters that occurred while he was employed by a member firm.

The NYSE imposed a penalty on Coyle of a censure and bar until he complies with the Exchange's request.

About NYSE Regulation: The New York Stock Exchange is the designated examining authority for the major securities firms in the United States, including more than 250 member firms that deal with the public and account for more than 85 percent of the public customer accounts carried by broker-dealers. These firms service 93 million customer accounts, operate from more than 21,000 branch offices around the world and employ approximately 157,000 registered personnel. The NYSE is committed to strong and effective regulation of its members and member firms to protect investors, the health of the financial system, and the integrity of the capital-formation process. While self regulation in the U.S. securities industry begins with the broker-dealer, the NYSE plays a critical role by maintaining an extensive system for monitoring and regulating the activities of its membership. The Securities and Exchange Commission oversees these activities.
NYSE Regulation consists of three divisions: Member Firm Regulation, responsible for the financial, operational and sales-practice regulation of member organizations; Market Surveillance, responsible for surveillance of all trading activities at the Exchange; and Enforcement, which investigates and prosecutes violators of NYSE rules and federal securities laws. There are approximately 560 people in NYSE Regulation, representing approximately one-third of the Exchange's staff.