CHICAGO — A Chicago trader was charged on Thursday, September 30, 2021 with securities fraud for allegedly engaging in unauthorized speculative bond trading that cost his employer and others more than $30 million.
Keith Wakefield, 48, of Chicago, was charged in a criminal information with one count of securities fraud. The charge is punishable by a maximum sentence of 20 years in federal prison. Arraignment in U.S. District Court in Chicago has not yet been set.
The charge was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Emmerson Buie, Jr., Special Agent-in-Charge of the Chicago Field Office of the FBI. The government is represented by Assistant U.S. Attorney John D. Mitchell.
The U.S. Securities and Exchange Commission, which filed a civil enforcement lawsuit against Wakefield, provided valuable assistance.
According to the charge, Wakefield worked as the head of fixed income trading in the Chicago office of a broker-dealer. From 2017 to 2019, Wakefield knowingly and fraudulently engaged in unauthorized speculative trading in U.S. Treasury bonds using his employer’s trading accounts, causing more than $30 million in losses to the employer and its counterparties, the information states. Wakefield attempted to conceal the unauthorized trades and losses by entering fake off-setting trades into a clearing broker’s order system, creating the false impression that he had profitably traded through a different clearing broker, the charge alleges.
In addition to the trading scheme, Wakefield allegedly embezzled approximately $820,000 from the employer by falsifying the company’s books and records to create fake commissions that Wakefield knew were not actually owed to him.
The public is reminded that an information is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. If convicted, the Court must impose a reasonable sentence under federal statutes and the advisory U.S. Sentencing Guidelines.
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