Rochdale Securities LLC, the brokerage struggling to survive after an unapproved $1 billion trade in Apple (AAPL:US) Inc. went sour, lost its two co-heads of trading to a rival firm.
Kristen Talgo and Hal Tunick, who led equities institutional trading from Rochdale’s Stamford, Connecticut headquarters, have joined Rafferty Capital Markets LLC, Financial Industry Regulatory Authority records show. The two collectively owned 20 percent to 50 percent of Rochdale, according to Finra records.
“If the senior people are bailing out, it’s obvious they don’t have much confidence,” said Richard Lipstein, managing director of New York-based recruiting firm Gilbert Tweed International. Lipstein, who hasn’t been involved in the moves, said the traders may have forfeited compensation by leaving.
Rochdale President Daniel J. Crowley is seeking a rescue for the 37-year-old company, home of Dick Bove, the analyst known for his coverage of the biggest U.S. banks. The brokerage hasn’t been allowed to trade since telling regulators last month that the Apple purchase had drained its cushion for losses, said two people with knowledge of the situation. That left employees unable to earn commissions, said the people, who asked for anonymity because they weren’t authorized to comment publicly.
Michael Rafferty, president of the firm bearing his name, declined to say whether he had hired the Rochdale employees. Talgo, Tunick and Crowley didn’t respond to e-mails and telephone calls. Bove, 71, said in an interview today he told Rochdale managers he’ll stay until the situation is resolved.
Top executives told potential investors that an employee named David Miller bought about $1 billion in Apple stock around the time of the Cupertino, California-based technology firm’s October earnings release, the people said. Kenneth “Casey” Murphy, Miller’s lawyer at Simon & Partners LLP in New York, declined to comment on Miller’s role.
Crowley has sought about $5 million to rebuild capital or a firm to merge with Rochdale, the people said. His task was complicated by the defections and by possible investigations from regulators into the firm’s struggle, the people said.
Other Rochdale employees who have joined Rafferty include Jeffrey Wicker, Peter Doehla and Patrick Burke, Finra records show. Burke, saying he spoke for all three, confirmed in an interview they had moved to Rafferty and wouldn’t elaborate. Dow Jones reported earlier today that Doehla and Burke had resigned.
Rafferty’s website lists its headquarters in Garden City, New York. The Finra records, dated Nov. 19, show the two trading co-heads joined Rafferty’s office in Rowayton, Connecticut.
Rochdale has provided trading and research for institutional clients since 1975, according to the company’s website.
To contact the reporters on this story: Hugh Son in New York at firstname.lastname@example.org; Zeke Faux in New York at email@example.com
To contact the editors responsible for this story: David Scheer at firstname.lastname@example.org; Rick Green at email@example.com