William M. Stephens, chief investment strategist at Husic Capital Management and formerly pension fund head at Ameritech Corp. and Southern Co., today was charged by the SEC with entering into a kickback and bribery scheme with union pension funds. The SEC sued 63 individuals and entities in five actions to clean up alleged boiler-room schemes in microcap stocks. Separately, the U.S. Attorney for the Southern District of New York and the FBI brought charges, naming 11 members and alleged associates of five organized-crime families, alleging securities fraud.
The SEC charges allege Mr. Stephens agreed to channel a portion of up to $300 million in union fund assets into fraudulent investments, which in turn would be paid to certain fund trustees as bribes or kickbacks. The SEC said Mr. Stephens initially had discussions with an unnamed intermediary who could influence the trustees’ selection of money managers and who would present him with the fraudulent investments, including Series J preferred stock to be issued by American Realty Trust and an interest in TradeVentures Fund, a hedge fund.
Officials at Husic did not return phone calls by deadline.
