finra

FINRA

For Release:
Contacts:

Thursday, August 18, 2011
Nancy Condon (202) 728-8379
Michelle Ong (202) 728-8464

 

Robert Thomas Bunda Action

 

FINRA Suspends and Fines Trader; Orders Restitution for Manipulative Trading that Artificially Impacted the Market Through a Concealed Account

WASHINGTON — The Financial Industry Regulatory Authority (FINRA) today announced that trader Robert T. Bunda, of Frankfort, Illinois, has been suspended for 16 months, fined $175,000 and is required to pay restitution of $171,740 for engaging in manipulative trading activity including spoofing that artificially impacted the market price of a Nasdaq security. Bunda attempted to conceal his improper trading activity through the use of one of his 11 undisclosed outside brokerage accounts.

 

Spoofing involves placing small limit orders at prices that improve the National Best Bid or Offer (NBBO) for a security, allowing the trader to take advantage of the improved prices by executing larger orders at another firm that offers execution guarantees at the NBBO. Once the larger order is executed at the artificially inflated price, the trader cancels the initial limit orders.

 

FINRA found that Bunda entered over 4,000 small share orders through his trading account at Great Point Capital LLC, his employer, to improve the NBBO for a Nasdaq security. After the market moved, Bunda entered a significantly larger order on the opposite side of the market to obtain a beneficial execution for his undisclosed personal brokerage account. After receiving the beneficial execution, Bunda cancelled a majority of the market moving orders he had entered through his Great Point account. Bunda engaged in a repeated pattern of spoofing to move the market for his own personal gain. In total, Bunda bought and sold shares in his undisclosed personal brokerage account in over 400 instances for an advantageous price gain of $171,740.

 

Thomas Gira, Executive Vice President, FINRA Market Regulation, said, "This case underscores FINRA's commitment to aggressively pursue disciplinary actions for manipulative trading schemes that undermine legitimate trading activity. Bunda's conduct was designed to artificially move the market for his own personal gain and demonstrates an unsuccessful attempt to conceal improper trading activity through non-disclosure of outside brokerage accounts."

 

In settling this matter, Bunda neither admitted nor denied the charges, but consented to the entry of FINRA's findings. The spoofing activity described above was referred to FINRA by NASDAQ's MarketWatch Department.

 

Investors can obtain more information about, and the disciplinary record of, any FINRA-registered broker or brokerage firm by using FINRA's BrokerCheck. FINRA makes BrokerCheck available at no charge. In 2010, members of the public used this service to conduct 17.2 million reviews of broker or firm records. Investors can access BrokerCheck at www.finra.org/brokercheck or by calling (800) 289-9999. Investors may find copies of this disciplinary action as well as other disciplinary documents in FINRA's Disciplinary Actions Online database.

 

FINRA, the Financial Industry Regulatory Authority, is the largest non-governmental regulator for all securities firms doing business in the United States. FINRA is dedicated to investor protection and market integrity through effective and efficient regulation and complementary compliance and technology-based services. FINRA touches virtually every aspect of the securities business – from registering and educating all industry participants to examining securities firms, writing and enforcing rules and the federal securities laws, informing and educating the investing public, providing trade reporting and other industry utilities, and administering the largest dispute resolution forum for investors and registered firms. For more information, please visit our website at www.finra.org.