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BAC ,,, Assistant Accuses Ex-Bank of America Broker
Wednesday May 11, 3:19 pm ET
Assistant Says Former Bank of America Broker Taught Her to Handle Mutual-Fund Trades With Fake Time Stamps


NEW YORK (AP) -- An assistant to former Bank of America Corp. broker Theodore C. Sihpol testified Tuesday that he taught her to handle mutual-fund trades with fake time stamps for a hedge-fund client.
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Sihpol, 37 years old, is accused of helping hedge fund Canary Capital Partners make improper trades in and out of mutual funds. Bank of America and the hedge fund paid millions of dollars to settle fund-trading charges with regulators, leaving Sihpol as the lone individual to face criminal charges in the affair. If convicted, he faces up to 30 years in prison.

Sihpol assistant Andrea Wenner, a 27-year-old business student, told jurors Monday about her role as an assistant to Sihpol between March 2001 and May 2003. Under examination by prosecutor Stephen Antignani, she described a routine in which she would receive a list of trades Canary was thinking about making that day, and soon after that time-stamp order tickets to look as though the trades had been executed then.

In fact, they weren't put through until later in the day, after Canary had confirmed them by phone after the market closed, she testified. Canary got that day's price for the fund shares, even though the trades were made late, earlier witnesses have testified.

During testimony Tuesday, Wenner said Sihpol was the person giving her orders on how to handle the trades.

Wenner, who was involved in figuring commissions Sihpol made by working with the hedge fund, also testified the former broker made "hundreds of thousands of dollars" through commissions.

The case hinges on a series of trades Sihpol allegedly helped the hedge fund make after mutual fund trading closed at 4 p.m. Eastern time. Ordinary investors in Nations Funds Trust, Pimco Funds, MFS Funds, the Janus Investment Fund, the Alger Fund and the RS Investment Trust were defrauded of millions of dollars as a result of the trades, according to New York Attorney General Eliot Spitzer, whose office brought the charges.

Though defense attorneys have tried to show that at least one Sihpol supervisor was kept in the loop about the trades, the prosecutor showed the court a number of proposed trade lists and order tickets that were directed only to Sihpol and Wenner.

"Who had the crux of responsibility with regard to the Canary trades?" the prosecutor asked. "Ted and me," Wenner replied.

Wenner also said she overheard Sihpol telling a supervisor that Canary made its trading decisions before 4 p.m., which was not usually the case.

The Sihpol trial, in state supreme court, is expected to last another six weeks.





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