$1B Apple Scheme: Trader admits fraud in $1 billion Apple stock scheme. A former Rochdale Securities trader whose unauthorized purchase of about $1 billion (654.3 million pounds) of Apple Inc stock caused the demise of the financial services company pleaded guilty on Monday to wire fraud and conspiracy.
David Miller, 40, entered his guilty plea before U.S. Magistrate Judge Donna Martinez in Hartford, Connecticut.
David Miller, 40, entered his guilty plea before U.S. Magistrate Judge Donna Martinez in Hartford, Connecticut.
Miller faces a maximum 25 years in prison when he is sentenced on July 8, but under a plea agreement he could receive a term of five to eight years. The Rockville Centre, New York resident is free on bond.
"What happened here was out of character for a kind and generous family man who has lived an otherwise law-abiding and good life," Miller's lawyer Kenneth Murphy said. "He deeply regrets what he has done and the harm it has caused to other people, including the former principals and employees at Rochdale."
The U.S. Securities and Exchange Commission filed a related civil fraud lawsuit against Miller on Monday.
Prosecutors said Miller bought 1.625 million Apple shares on October 25, 2012, the day the maker of iPads, iPods and iPhones planned to report third-quarter results, hoping to profit if the company's share price rose.
But they said Miller falsely told Rochdale that the trade was for a customer that had in fact ordered just 1,625 shares.
When the bet backfired, Rochdale was on the hook for $5.3 million of losses on the extra 1,623,375 shares, leaving the Stamford, Connecticut-based company undercapitalized, the SEC said in court papers.
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