Ex-Jefferies director could spend decade in prison

Prison Bars

Former Jefferies managing director Jesse Litvak, the only person convicted of fraud related to a $20bn government bail-out program, may spend almost a decade in prison for lying to his customers about mortgage-backed securities.

Bloomberg News reports that Litvak was found guilty by a jury in March of securities fraud and making false statements, as well as fraud connected to the U.S. Treasury Department’s Troubled Asset Relief Program. His conviction is the first in connection with the Public-Private Investment Program, an initiative that used TARP funds to spur investments in mortgage-backed securities after the 2008 financial crisis.

The case raised questions across Wall Street about just how much trickery is allowed in trading as witnesses at Litvak’s trial testified that his tactics were common.

Litvak, 39, of New York, is scheduled to be sentenced Tuesday by U.S. District Judge Janet C. Hall in New Haven, Connecticut. Prosecutors have asked Hall to send the former trader to federal prison for nine years and have him pay a $5m fine, saying he 'perpetrated a multi-year, multi-victim, multimillion-dollar securities fraud scheme'.

To access the complete Bloomberg News article hit the link below:

Ex-Jefferies Trader May Face Prison Decade for Bond Lies

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