Betting on Apple leads trader to jail
A Wall Street Trader is thoroughly regretting believing Apple's hype machine.
According to Reuters, David Miller, 41 was jailed for 2 1/2 years for making an unauthorised purchase of about $1 billion in Apple stock.
Miller completely believed that Apple shares would have to go up because everyone in the mainstream press told him that. That eventually led to the end of financial services firm Rochdale Securities.
Miller, of New York, conspired with another individual to buy 1.625 million Apple shares on October 25, 2012, the same day that the company planned to report third-quarter results, in the hopes that the share price would rise.
Miller falsely told his share broking company Rochdale the trade was for a customer who had, in fact, only asked to buy 1,625 shares, prosecutors said.
Sadly for Miller the deal went pear shaped when Apple's steam roller stalled and the shareprice plummeted.
Rochdale faced $5.3 million in losses on the additional unauthorised shares, leaving the firm undercapitalised and the company collapsed.
Miller defrauded another brokerage by convincing it to sell 500,000 shares of Apple to hedge against the buy he had made at Rochdale. The second brokerage was able to trade out of the position at a profit.
Pleading guilty to the charge of wire fraud and conspiracy, Miller said he was sorry for the harm his actions caused, said his defence attorney Kenneth Murphy.
He was a good and decent man who had led an otherwise exemplary life who acted out of desperation rather than greed, Murphy claimed.