News Flash- STC Employee Fesses Up Faces up to 4 Years in Jail
December 15, 2003
Nicole McDermott, former senior vice president of corporate services at Security Trust Co., pled guilty to securities fraud charges for allowing hedge fund clients to trade behind the bell, NY AG Eliot Spitzer said.
She faces a maximum of four years in prison. She was arrested on Nov. 25, along with CEO Grant Seeger and former President William Kenyon on charges of grand larceny, falsifying business records and securities fraud. The trio was charged with stealing millions of dollars in mutual fund shares by engaging in illegal late trading schemes.
McDermott admitted to directing STC employees to place a bulk of its orders for mutual fund shares on behalf of two hedge fund clients after the market closed, but still receive pre-4 p.m. prices. She also admitted to purposely disguising the illicit trades as orders for one of STC's client retirement plans.
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