Weston Resident Sentenced for Orchestrating a Stock Trading Scheme, Reports U.S. Attorney

Apr 17, 2001, 01:00 ET from U.S. Attorney

    BOSTON, April 17 /PRNewswire/ -- A Weston resident was sentenced to a
 15-month term of imprisonment today for orchestrating a stock trading scheme
 known as "free riding."
     United States Attorney Donald K. Stern and Charles Prouty, Special
 Agent-In-Charge of the New England Division of the Federal Bureau of
 Investigation announced that KENNETH BARRON, age 59, 167 Conant Road, Weston,
 MA was sentenced on seventeen counts of securities fraud and wire fraud.  U.S.
 District Judge Edward F. Harrington imposed a sentence of 15 months in prison,
 to be followed by three years of supervised release, and restitution to
 victims in the amount of $157,571.  The Court did not order payment of a fine,
 notwithstanding the prosecution's request, and agreed to recommend to the
 Bureau of Prisons that BARRON serve his sentence in community confinement.
     At an earlier hearing, Assistant U.S. Attorney Jeanne M. Kempthorne told
 the Court that BARRON engaged in over $9 million worth of margin trading
 activity without intending to pay for losing trades.  The practice of shifting
 the risk of loss on securities purchases to the brokerage firm is called "free
 riding."  Over the course of the scheme, which lasted from November 1995 to
 May 1999, BARRON caused brokers to absorb hundreds of thousands of dollars of
 losses.
     This investigation was conducted by Special Agents of the Federal Bureau
 of Investigation.  The case was prosecuted by Assistant U.S. Attorney Jeanne
 M. Kempthorne of Stern's Economic Crimes Unit.
 
 

SOURCE U.S. Attorney
    BOSTON, April 17 /PRNewswire/ -- A Weston resident was sentenced to a
 15-month term of imprisonment today for orchestrating a stock trading scheme
 known as "free riding."
     United States Attorney Donald K. Stern and Charles Prouty, Special
 Agent-In-Charge of the New England Division of the Federal Bureau of
 Investigation announced that KENNETH BARRON, age 59, 167 Conant Road, Weston,
 MA was sentenced on seventeen counts of securities fraud and wire fraud.  U.S.
 District Judge Edward F. Harrington imposed a sentence of 15 months in prison,
 to be followed by three years of supervised release, and restitution to
 victims in the amount of $157,571.  The Court did not order payment of a fine,
 notwithstanding the prosecution's request, and agreed to recommend to the
 Bureau of Prisons that BARRON serve his sentence in community confinement.
     At an earlier hearing, Assistant U.S. Attorney Jeanne M. Kempthorne told
 the Court that BARRON engaged in over $9 million worth of margin trading
 activity without intending to pay for losing trades.  The practice of shifting
 the risk of loss on securities purchases to the brokerage firm is called "free
 riding."  Over the course of the scheme, which lasted from November 1995 to
 May 1999, BARRON caused brokers to absorb hundreds of thousands of dollars of
 losses.
     This investigation was conducted by Special Agents of the Federal Bureau
 of Investigation.  The case was prosecuted by Assistant U.S. Attorney Jeanne
 M. Kempthorne of Stern's Economic Crimes Unit.
 
 SOURCE  U.S. Attorney