Ex-Citigroup broker Ralph Casbarro was fined a measly $500 today for his part in a 2005 front-running scheme, reports Bloomberg.Casbarro was one of the brokers who put telephones against their internal radio system to broadcast information to traders, in exchange for $310,000 in bribes. Traders used the information to front-run purchases by large clients, earning at least $650,000.
The reason Casbarro got off so light was he “extensively cooperated with the government,” says his lawyer.
Meanwhile, Kenneth Mahaffy Jr. and five other brokers were found guilty for the same scheme last year and sentenced to jail time and probation.
It’s easy to see how a witness would be key to breaking the case. The squawkbox scheme was clever because it gave all brokers plausible deniability of involvement. Only the broker who left his phone off the hook could be blamed. The other guys claimed they did this out of sheer laziness.
Casbarro may have planned to squeal from the beginning, as he was the only broker to shield his face from photographers at an ’05 arraignment.