A $2 Million Fine for Kited Checks

Costly floats for Wall Street's most listened-to broker

"This is a sad and difficult day for E.F. Hutton and for me personally," said a subdued Robert Fomon, chairman and chief executive of Wall Street's fifth-largest brokerage firm. Hours before Fomon appeared at a press conference in New York City last week, Hutton President Scott Pierce had pleaded guilty on behalf of the firm to 2,000 separate criminal charges of mail and wire fraud. After accepting Pierce's pleas in a Scranton, Pa., courtroom, Federal Judge William Nealon fined Hutton the maximum $1,000 on each charge, or a total of $2 million. Never before had a prestigious Wall Street investment group...

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