A New York Stock Exchange floor trader from Little Silver was sentenced to 27 months in federal prison yesterday for his guilty plea to charges of “trading ahead” of clients, or buying stocks for his or his firm’s account at prices better than those available to clients.
Patrick McGagh Jr., 40, a former senior trader with Van Der Moolen Specialists USA, was indicted in April 2005 as part of a wide-ranging sweep of floor specialist firms that cost investors some $19 million, according to federal prosecutors.
At the time of his guilty plea last May, McGagh admitted he improperly traded shares of drugmaker Pfizer Inc., according to the Associated Press. “I knew at the time that I was doing this that I was wrong and I am sorry,” he said.
Fifteen floor specialists from five firms were charged. Othern than McGagh, another trader who was sentenced yesterday and third who went on trial yesterday, two others have been convicted at trial, two have been found not guilty and charges have been dropped against two. The others are awaiting trial.
Also charged in the purported scheme were Frank A. Delaney IV, of Rumson and Patrick Murphy of Monmouth Beach. The status of their cases could not be learned last night.
The Associated Press has the story.