Reuters reports that Druffner’s attorney says he is likely to plead guilty to the charges, but added, “…virtually everything he did with respect to market timing was approved or permitted by his superiors.”
Druffner and a group of other former employees were charged by US Attorney Michael Sullivan with market timing mutual funds on behalf of hedge fund clients, at times using false names, according to Reuters. Druffner earned $1 million in commissions from the scheme.
Reuters also noted that six other former Prudential employees, including two managers, left the company in the fall of 2003, after state and federal securities regulators announced a sweeping probe of the multitrillion dollar industry, which handles the assets of half of all U.S. households.
In December of 2003, other former employees were charged with late trading by the Massachusetts Secretary of State because they ignored the actions of the former brokers (See Prudential Securities Charged with Late Trading ). Erlier in the month, Skifter Ajro, one of the other former brokers charged, pleaded guilty (See Ex-Pru Broker Pleads Guilty to Market Timing Allegations ).