trending Market Intelligence /marketintelligence/en/news-insights/trending/IetZcrhewqcK5yzfQoa1_g2 content esgSubNav
In This List

Report: Ex-IFS Securities exec caused losses in off-book Treasury trades

Podcast

Street Talk Episode 87

Blog

A New Dawn for European Bank M&A Top 5 Trends

Blog

Insight Weekly: US banks' loan growth; record share buybacks; utility M&A outlook

Blog

Banking Essentials Newsletter 2021: December Edition


Report: Ex-IFS Securities exec caused losses in off-book Treasury trades

Former IFS Securities Inc. Managing Director Keith Wakefield allegedly shorted U.S. Treasurys in an off-book transaction that resulted in a minimum loss of $10 million, The Bond Buyer reported, citing sources.

Sources said Wakefield was fired over these allegedly illegal trades and that the firm does not have sufficient funds to settle the trades and cover losses. An industry source, citing internal employee speculation, said the nominal value of the loss is possibly more than $200 million, while another source said the losses have grown to more than $20 million from the reported amount of $10 million.

A source close to the employees told the publication that this incident will raise various regulatory and criminal issues, such as whether the company properly supervised Wakefield, whether trading caps were imposed on employees and how long Wakefield engaged in alleged off-book trades through a variety of platforms. The sources said the trades would be difficult to track considering they are off-book.

In a statement, IFS Securities confirmed it had fired a senior employee related to unauthorized transactions and reported the incident to the Securities and Exchange Commission and Financial Industry Regulatory Authority. It also reported the incident to the Federal Bureau of Investigation, upon request by the SEC.

The SEC in June fined IFS Securities $50,000 for selling municipal bonds that were below the market price for comparable bonds. The company in 2014 underwrote a $6 million offering, with the proceeds intended for the expansion and renovation of the Harvey, Ill., Public Library District.