Hat tip to Pat Walsh and her Middletown Musings blog for finding “The Public Needs To Know” website , the idea behind this site is to let the public know about waste, abuse and stupid government actions that lead to the misuse of tax payer dollars.
One of the most prestigious positions on Wall Street is serving on the Board of the NY Stock Exchange. In 2003 it was even more prestigious given the boom market the economy was experiencing. Todd Christie, Chris Christie’s brother was nominated to serve on the NY Stock
Exchange Board. However, something happened.
Todd Christie was head of Spear, Leeds & Kellogg which he sold to Goldman Sachs (Jon Corzine’s old firm) in 2000 for $100,000,000.00. As the head of Goldman Sachs’ NYSE trading unit and had been asked to serve as the industry rep to the board. However, before he could be
confirmed to that position, he withdrew his nomination amid a number of issues that arose.
One of them included an accusation that he made 1,600 illegal trades resulting in clients getting ripped off to the tune of $1.4 million. Not only did he withdraw his nomination but he totally quit his job at Goldman Sachs in March of 2003.
Keep in mind that Todd Christie, who lived and lives in New Jersey, is the younger brother of Chris Christie, the US Attorney for New Jersey who is noted for fighting crime and corruption.
Since early in 2001, when Chris Christie was lobbying to become the US Attorney for NJ, Todd Christie and his wife had donated more than $400,000 to various GOP coffers. He not only opened his own checkbook, but teamed up with his brother’s current campaign spokesman, Bill
Palatucci, and current campaign fundraiser, Jon Hanson, to raise money for the George W. Bush campaign. Together, the three were approaching Bush’s “Super Ranger” status by closing in on the $300,000 contribution mark.
In 2005, Todd Christie was among 20 former Wall Street specialists accused of fraudulent trading practices. Fifteen of the 20 specialists also were indicted on criminal charges by the U.S. Attorney’s Office in Manhattan for the same practices. On the criminal charges, each defendant faced up to 20 years in prison and fines up to $5,000,000.00
“These defendants broke the rules repeatedly, they cheated the markets and the cheated the investors who relied upon them, “said David N.Kelly, U.S. Attorney for the Southern District of New York.
“The conduct here was quite egregious,” said David Rosenthal, an associate regional director for the Securities and Exchange Commission. “Christie was one of the worst.” Christie was a specialist in IBM, AOL and AIG stocks. Yes, that AIG!!
According to the SEC, Todd Christie committed more that 1,600 improper trades between January 1999 and March 2003, generating “riskless profits” of more than $1.59 million for Spear Leeds (his own company) and costing his clients more than $1.4 million. The SEC would later demand that Todd Christie pay $3,820,000.00 in penalties and restitution for allegedly ill gotten profits.
Christie ranked fourth in the SEC complaint among the 20 traders who earned the biggest profits at customers’ expense. The top three were indicted, as were 11 traders lower down. Somehow he avoided being indicted but still faced civil proceedings. Is this preferential treatment? Is it the appearance of impropriety or something else?
Question: Why did U. S. Attorney David Kelly not indict Chris Christie’s younger brother for the same things he indicted other people for?
Shortly after the civil proceedings started against Todd Christie another fraud case ensued under the jurisdiction of the US Attorney from New Jersey’s office. It involved 5 makers of hip and knee implants who avoided prosecution by agreeing to pay $311 million to settle allegations that they secretly paid off orthopedic surgeons to endorse and use their products.
According to prosecutors, by not disclosing they collected as much as $1 million a year in consulting fees, surgeons, cheated patients and broke Medicare laws. Four of the companies agreed to pay civil settlements with the Department of Health and Human Services, ranging from $169 million to $26.9 million. They signed deferred prosecution agreements pledging to change their practices and to accept a federal monitor asconditions for avoiding future fraud charges.
One of the firms was represented by Herbert Stern, a former federal judge who has served as a mentor to Chris Christie and a contributor to his campaign for Governor.
According to newspaper reports, the firm Stern represented avoided the penalties handed out by Christie to the other firms. Christie would later give Stern a multi-million dollar no-bid contract as a federal monitor in an unrelated case.
One other firm agreed to pay $169.5 million and was to be monitored by former US Attorney General John Ashcroft, Christie’s boss when he was US Attorney for New Jersey. Ashcroft’s firm was poised to collect more than $52 million in 18 months, among the biggest payouts reported for a federal monitor.
“But I also understand in the aftermath there was the perception of coercion and you have to deal with that perception,” said Chris Christie.
However, while most stories seemed to focus on Ashcroft, what most failed to ever zero in on is David Kelly. Kelly was the prosecutor who didn’t indict Chris Christie’s kid brother in April 2005. Just a few months later, Kelly left his position to practice law privately.
Todd Christie was the only one of the top 15 defendants that did not get indicted.
In 2007, U.S. Attorney Chris Christie “hand-picked” David Kelly for a no-bid monitoring contract worth as much as $8 million.
Question: Why did U. S. Attorney Chris Christie give a multi-million dollar no-bid contract to the man who let Christie’s brother off the hook? Wasn’t he concerned about appearances?
For those who want sources and documentation click the following PDF link: Todd Christie’s SEC Timeline.