Former Bond Trader Wins a Round Against Kidder
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Joseph Jett, the bond trader accused of creating $339 million in false trades at Kidder, Peabody & Company, won a partial vindication yesterday as an arbitration panel rejected Kidder’s accusation that Mr. Jett had engaged in ”fraud, breach of duty and unjust enrichment.” ”For two and a half years, the Kidder publicity machine classified Joseph Jett as a rogue trader, a crook, a fraud and a thief and now a securities industry panel of arbitrators looks at all of the proof and has rejected all of Kidder’s claims,” said Kenneth Warner, Mr. Jett’s lawyer. Kidder contends that Mr. Jett created false trades to increase his compensation and to hide trading losses. Though the panel ruled in Mr. Jett’s favor, that decision does not clear him entirely. The Securities and Exchange Commission has brought civil proceedings against Mr. Jett, accusing him of fraud. A ruling by an administrative law judge is due early next year. Securities lawyers said the arbitration panel’s ruling might not be much of a precedent for the S.E.C.’s decision. The panel, of the National Association of Securities Dealers, awarded Mr. Jett the rights to the $5 million in his brokerage account, which Kidder froze after the supposedly false trades were discovered in 1994. It gave him immediate access to $1 million in that account, with the disposition of the remainder subject to a hearing in January as to whether Kidder will have to pay Mr. Jett’s attorney’s fees. More : query.nytimes.com |