Sihpol Heads to Trial on Improper Fund Trading Charges

March 14, 2005 ( - A former Bank of America Corp. broker is headed to trial on criminal charges relating to allegations he helped a hedge fund conduct millions of dollars in illegal or improper mutual fund trades.

Justice James Yates of the New York Supreme Court in Manhattan removed the last obstacle to trial on Monday when he turned aside a bid by Theodore Sihpol to have the fraud, grand larceny and falsifying business records charges dismissed, Reuters reported.

Sihpol was the first person arrested by New York Attorney General Eliot Spitzer in his 18-month probe of the $8 trillion US mutual fund industry (See  Ex-BoA Broker Sihpol Indicted in Scandal ). Spitzer accused Sihpol of helping Canary Capital Partners LLC conduct late trading transactions.

Bank of America fired Sihpol in September 2003 after Spitzer accused several companies, including Bank One Corp., Janus Capital Group Inc. and Strong Capital Management, of allowing improper trading.

The US Securities and Exchange Commission last month approved a $675 million settlement with Bank of America, the largest accord yet to resolve allegations of illegal fund trading (See  Five Former BoA Employees Charged in Market Timing Probe ).