Traders Plead Guilty to Conspiracy
NEW YORK (AP)_ Two commodities traders have pleaded guilty in Manhattan federal court to charges that they earned $4.7 million by illegally trading on insider information.
Andrew D. Rhee, 32, of Miami Beach, Fla., and Thomas E. Kelly, 32, of Darien, Conn., entered the pleas in U.S. District Court to one count of conspiracy to commit wire fraud.
The men who grew up as close friends in Connecticut could face up to five years in prison and fines of $250,000 when they are sentenced Oct. 9. They each remain free on $1 million bond.
The illegal scheme was carried out while Kelly worked for John W. Henry & Co. between 1995 and early 1998 at the company’s headquarters in Boca Raton, Fla., prosecutors said this week.
Kelly stole confidential information from the company about its trading strategies and then made trades ahead of the company to benefit from what they knew, prosecutors alleged.
This scheme, known as ``front running,″ permitted the men to profit as the company carried out trades including futures contracts for gold, silver, copper, sugar, coffee, cotton, corn, wheat, cocoa, cattle, soybeans and various stock indexes, prosecutors said.