WASHINGTON (Legal Newsline) — The Securities and Exchange Commission (SEC) announced June 22 that it is adding additional charges in a case involving improper handling of American Depositary Receipts (ADRs) by a Wall Street firm’s securities lending desk.
According to SEC allegations, Anthony Portelli was a former managing director and head of operations at broker-dealer ITG Inc. who was responsible for his company’s ADR transactions – U.S. securities representing foreign shares of a foreign company. Portelli allegedly failed to take reasonable steps in ensuring that ITG’s customers had proper amounts of foreign shares.
Portelli agreed to settle the charges and pay $100,000 in penalties. As per the agreement, Portelli will not be able to act in a supervisory capacity in the industry for 18 months.
“Supervisors at broker-dealers have a responsibility to act reasonably to prevent and detect violations of the securities laws. Portelli routinely signed off on transactions involving ADRs that were not backed by actual shares and should never have been issued,” said Sanjay Wadhwa, senior associate director of the SEC’s New York Regional Office.
Andrew Dean, William Martin, Elzbieta Wraga, and Adam Grace of the New York office are handling the case, under the supervision of Wadhwa.