Ex-brokers face ‘squawk box’ retrial

Three brokers are charged with allowing day traders to eavesdrop on their firms' internal loudspeakers.

Three former stock brokers will face a retrial come November on charges that they conspired to commit fraud by allowing day traders to eavesdrop on their firms’ internal loudspeakers, or “squawk boxes,” through open telephone lines.
As all three defendants were acquitted of fraud charges last month, the new trial will be the government’s second shot at pinning the three former brokers at Merrill Lynch and Co. Inc., Citigroup and Lehman Brothers Holdings Inc. with conspiracy charges.
The defendants denied the allegations and according to published reports will pursue motions to dismiss the case on double jeopardy grounds.
The former brokers facing trial are Kenneth Mahaffy, who worked for Merrill Lynch and Citigroup’s Smith Barney unit; Timothy O’Connell, who worked alongside Mr. Mahaffy at a Merrill Lynch branch in New York; and David Ghysels, who worked at a Lehman Brothers office in Florida.
Each defendant faces a maximum of 25 years in jail and $250,000 in fines.