Ex-Bank Of America Broker Sihpol's Bail Set At $750,000Sep 16, 2003 | Wall Street Journal Theodore C. Sihpol III's bail was set at $750,000 Tuesday afternoon during the former Bank of America Corp. broker's appearance in a New York courtroom.
But Sihpol, charged with a felony earlier in the day by New York state Attorney General Eliot Spitzer for his alleged role in an illegal mutual fund trading scheme, was taken into custody, despite having a check written out to satisfy the $50,000 bond, because the court only accepts cash payments.
Sihpol was also ordered to turn over his passport to Buchwald and his travel, if he posts bond and leaves jail, was restricted to New York, New Jersey, Massachusetts and Connecticut, where he lives with his wife and 21-month-old son.
If Sihpol doesn't pay the $50,000 cash bond, he will have another court appearance Friday.
The former broker for wealthy Bank of America clients could be sent to prison for up to 25 years, although his sentence could be far less. The Securities and Exchange Commission joined Spitzer in going after Sihpol, filing a civil case alleging securities fraud in U.S. District Court in Manhattan.
According to Spitzer's complaint, Sihpol was among the Bank of America employees who arranged illegal trading of mutual fund shares with Canary Capital Partners LLC, a hedge fund. Two weeks ago, Canary's managing partner, Edward J. Stern, agreed to pay $40 million to settle Spitzer's accusations and cooperate with the attorney general's investigation.
The trading scheme, according to Spitzer and the SEC, generated profits for Canary at the expense of individual investors in Bank of America's mutual funds.