Thursday, May 29, 2003 | 11:19 a.m.
Ex-analyst found too tight with Tyco
NEW YORK -- A former Merrill Lynch analyst who covered Tyco International was accused by securities regulators on Wednesday of issuing misleading research reports, disclosing nonpublic information and accepting gifts from the company's chief executive.
According to a civil complaint filed by NASD, the analyst, Phua Kear Young, flew around the country in the corporate jet of L. Dennis Kozlowski, Tyco's chief executive; alerted institutional investors to details of coming reports, making them privy to market sensitive information that they could profit from; and skipped compliance meetings with lawyers, persuading subordinates to falsify his signature so it would appear that he attended.
The complaint also says he sent a case of wine to Kozlowski and used private investigators retained by Tyco. In some e-mail messages, according to the complaint, Young went so far as to refer to himself as a loyal Tyco employee and joked that he was indirectly paid by the company.
Payment disclosed
CHARLOTTE, N.C. -- Bank of America Corp. made an undisclosed payment to a securities firm in 1999 to publish research on Just for Feet Inc., a client that went bankrupt later that year, people familiar with the matter told Bloomberg News.
The payment to U.S. Bancorp Piper Jaffray came two months after the securities unit of Bank of America arranged the April sale of $200 million of high-yield, high-risk bonds for Just for Feet, a shoe retailer. Most of the proceeds were used to repay loans to Charlotte-based Bank of America, the third-largest U.S. bank.
Piper Jaffray received $400,000 in connection with the Just for Feet junk-bond sale, according to documents in last month's $1.4 billion settlement between Wall Street firms and regulators over misleading research. At the end of May 1999, Minneapolis-based Piper Jaffray was the only brokerage to recommend buying the stock.
Column used in insider trading
NEW YORK -- A janitor and a machinist from Wisconsin engaged in more than $40 million worth of illegal insider trading by bribing printing plant employees to leak information from BusinessWeek Magazine, prosecutors said today.
Gregory J. Misfeldt and Gregory L. Tyrer reaped about $1.4 million in illegal profits by getting the names of companies discussed in "Inside Wall Street," a column, the Securities and Exchange Commission said. The traders paid the printing plant employees, Jodi L. Knueppel and Mark R. Sonday, from $50 to $500 a week for the information.
This is the fourth insider trading case in which investors have sought to profit on early access to the Inside Wall Street column, according to Michael Cornacchia, an assistant U.S. attorney. The column, written by Gene Marcial, has been a tempting target for insider trading because its contents often lead to an increase in the price of stocks discussed.
Firm formed for production
The Greenspun Media Group said today it formed a new company with SoBe News Inc. to produce VEGAS Magazine -- described by Greenspun Media as "an upscale, affluent bible to everything Vegas and the lifestyle it embodies."
The national lifestyle magazine debuts in July and will be distributed in Las Vegas and through newsstands in key tourist feeder cities including Chicago, Dallas, Detroit, Los Angeles, Minneapolis, New York, Phoenix, San Diego, San Francisco, Seattle and Miami.
Greenspun Media Group, owner of several publications serving Las Vegas, is a sister company to the Las Vegas Sun. SoBe News' publications include Ocean Drive magazine, covering South Florida.
Michael Carr, former president of Playboy, and Jerry Powers, Ocean Drive publisher, will be co-publishers of VEGAS Magazine.
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