The only listed Dutch trading firm Van der Moolen has settled charges for improper trading within its US specialist unit back in 2004. It has sold the US specialist activities in December 2007 to the prestigious Lehman Brothers. One would expect this would end the stream of legal problems for the troubled firm. Wrong, according to the NYSE disciplinary actions list published April 8th.
In the summer of 2007 VDM specialist Brian Schaeffer mishandled the opening of a certain stock. He failed to maintain a fair and orderly market, and a stock opened $12,43 below the previous closing price – at $61,25. That’s a 25.000 dollar fine for the trader. Apparently mister Schaeffer wasn’t a junior trader, as he was seen explaining president Bush the magic of the stock market in the same year.
Second, the company VDM will have to compensate the investors for a total amount of $400.000, and will have to pay a 40k fine as well. This is incomparable with the recent 43 million dividend tax loss, but is nevertheless worrisome as it’s still VDM to pay the bills. The demons of the past keep haunting the firm.
On the same day this disciplinary action was released by NYSE, Van der Moolen nominated a lawyer to be elected in their supervisory board. Probably there’s another round of legal warfare ahead. Finacial newspaper FD must have reached a similar conclusion, as it assembled a couple of claims from different institutions on April 10th.