Bloomberg News

SEC Examiner Charged With Lying About Bank Stock Holdings (1)

November 19, 2013

An SEC official was arrested and charged with lying about owning stocks in banks including Citigroup Inc. (C:US), Bank of America Corp. (BAC:US) and Morgan Stanley (MS:US), in violation of the agency’s ethics rules.

Steven Gilchrist, a compliance examiner with the U.S. Securities and Exchange Commission’s New York office, was charged with three counts of making false statements in a complaint filed today in Manhattan federal court.

Gilchrist, 48, of Bethpage, New York, is accused of lying to the SEC in January and February about his holdings, which also included Ambac Financial Group Inc. (AMBC:US) and MBIA Inc. (MBI:US) If convicted, he faces as long as 15 years in prison.

“Each of the financial services companies is regulated by the SEC, and therefore constitute prohibited holdings for SEC employees,” Jordan Goodman, a criminal investigator in the office of Manhattan U.S. Attorney Preet Bharara, said in the complaint.

Gilchrist, who appeared in federal court in Manhattan today, was ordered released without bail. His lawyer, Laura Miranda, declined to comment on the charges after her client’s court appearance.

“We are very disappointed that an employee allegedly made false statements to conceal prohibited holdings after being told by our ethics office to divest,” John Nester, an SEC spokesman, said in an e-mail.

The case is U.S. v. Gilchrist, 13-mg-02707, U.S. District Court, Southern District of New York (New York).

To contact the reporter on this story: Bob Van Voris in federal court in Manhattan at rvanvoris@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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Companies Mentioned

  • C
    (Citigroup Inc)
    • $50.09 USD
    • -0.09
    • -0.18%
  • BAC
    (Bank of America Corp)
    • $15.62 USD
    • 0.10
    • 0.64%
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