Jesse Litvak, a former Jefferies Group LLC (JEF) bond trader, is scheduled to go on trial again. It was just two years ago that a jury found him guilty of fraud when he misled customers about the price he paid for residential mortgage-backed bonds.
The criminal charges against him were originally brought by the US attorney’s office in Connecticut three years ago. Prosecutors accused him of bilking customers of $2M when he inflated the prices of what he’d actually paid for the bonds. Because of purported misstatements, professional investment managers and hedge funds overpaid for the residential-mortgage-backed bonds. Meantime, Litvak allegedly made $100K more for his firm for every transaction than was disclosed to his customers.
The jury, in 2014, found that Litvak violated securities laws and they found him guilty on 15 criminal counts, including multiple counts of securities fraud. Litvak had pleaded not guilty to all of the charges. He was then sentenced to two years in prison and ordered to pay a $1.75M.