The rogue trader who allegedly brought Rochdale Securities to its knees after an unauthorized and money-losing $1 billion Apple trade in October was arrested yesterday and charged with fraud.
In a 13-page criminal complaint charging him with wire fraud, federal prosecutors claim David Miller was part of a scheme that bought 1.625 million shares of the tech titan and planned “to generate profits by trading out of the position after Apple announced its earnings later that day.”
But instead of pocketing profits, the trader blew a $5 million hole in the Stamford, Conn., boutique broker-dealer’s balance sheet, the US Attorney in Bridgeport, Conn., charged.
As part of Miller’s alleged scheme, he lied to another unnamed broker-dealer about being a trader from another unidentified entity, according to the complaint.
The Federal Bureau of Investigation, the Securities and Exchange Commission and the Financial Industry Regulatory Authority, which have been working together on the case, are still trying to determine if Miller’s trade is a part of a more extensive scam, sources said.
Arriving at court in a charcoal-gray suit and burgundy tie — alongside his lawyer, Kenneth Murphy of Simon & Partners, and his family — Miller appeared quiet and solemn. He was released on $300,000 bail.
The 40-year-old Long Island trader — who is married with three children and has a white Labrador retriever — had recently been having “serious personal financial difficulties,” the complaint charges.
Rochdale CEO Crowley, who helped found the firm in 1975 and is fighting to keep it alive in the aftermath of the damaging trade, also was present when Miller appeared in court. Despite their proximity, the two men did not interact, sources said.