Newspaper article THE JOURNAL RECORD

Securities Firm Pays State $800,000 Settlement

Newspaper article THE JOURNAL RECORD

Securities Firm Pays State $800,000 Settlement

Article excerpt

A New York securities firm has paid the State of Oklahoma $800,000 as part of a settlement to a lawsuit accusing three brokerages of overcharging the state, officials announced Monday.

New York-based Mabon Securities Corp. is one of three sued by the state over the kickback scandal involving former State Treasurer Claudette Henry's office, said Attorney General Drew Edmondson and Irving Faught, administrator of the Oklahoma Securities Department.

Two lawsuits were filed against Mabon and two other brokerages, Planners International Management Inc. of San Diego and Adler, Coleman Clearing Corp. of New York, now subject to liquidation by the Securities Investor Protection Corp. Oklahoma, as a creditor, has an SPIC claim pending. One lawsuit was brought by former Attorney General Susan Loving, representing the state as a customer of the brokerage houses. A regulatory action was filed by the state securities department, with Faught asking the court to require the brokerage houses and their employees to "disgorge their profits" derived from illegal activities. The department also issued a cease and desist order against Mabon. The suits alleged the firms overcharged the state, and were guilty of the other securities law violations, in buying and selling U.S. government securities for the state treasurer's office between March 1991 and December 1992. The Mabon transactions occurred between March-September 1991. Faught said Mabon acted as a clearer for Planners International, and that Adler, Coleman replaced the firm as a clearer in September 1991. The state alleged Mabon was at fault by allowing a scandal to occur or failing to adequately supervise its employees. …

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