UNITED STATES OF AMERICA

Before the

SECURITIES AND EXCHANGE COMMISSION

SECURITIES EXCHANGE ACT OF 1934

Release No. 72846 / August 14, 2014

ADMINISTRATIVE PROCEEDING

File No. 3-16017

In the Matter of

LINKBROKERS 

DERIVATIVES LLC,

Respondent.

ORDER INSTITUTING ADMINISTRATIVE 

AND CEASE-AND-DESIST PROCEEDINGS, 

PURSUANT TO SECTIONS 15(b) AND 21C 

OF THE SECURITIES EXCHANGE ACT OF 

1934, MAKING FINDINGS, AND IMPOSING 

REMEDIAL SANCTIONS AND A CEASEAND-DESIST ORDER 

I.

The Securities and Exchange Commission (“Commission”) deems it appropriate and in the 

public interest that public administrative and cease-and-desist proceedings be, and hereby are, 

instituted pursuant to Sections 15(b), and 21C of the Securities Exchange Act of 1934 (“Exchange 

Act”) against Linkbrokers Derivatives LLC (“Linkbrokers” or “Respondent”). 

II.

In anticipation of the institution of these proceedings, Respondent has submitted an Offer 

of Settlement (the “Offer”) which the Commission has determined to accept. Solely for the 

purpose of these proceedings and any other proceedings brought by or on behalf of the 

Commission, or to which the Commission is a party, and without admitting or denying the findings 

herein, except as to the Commission’s jurisdiction over Respondent and the subject matter of these 

proceedings, which are admitted, Respondent consents to the entry of this Order Instituting 

Administrative and Cease-and-Desist Proceedings Pursuant to Sections 15(b) and 21C of the 

Exchange Act, Making Findings and Imposing Remedial Sanctions and a Cease-and-Desist Order 

(“Order”), as set forth below. 
2

III.

On the basis of this Order and Respondent’s Offer, the Commission finds1 that:

A. Summary

These proceedings arise out of a fraudulent scheme perpetrated by certain employees at 

Linkbrokers, a New York based interdealer broker, to unlawfully take secret profits of more than 

$18 million at the expense of its customers. From at least 2005 through at least February 2009 (the 

“relevant period”), on over 36,000 customer transactions, certain employees of Linkbrokers 

perpetrated the scheme by charging customers false prices in which Linkbrokers embedded hidden 

markups or markdowns.

Marek Leszczynski, Benjamin Chouchane, Gregory Reyftmann, Henry Condron, and 

another individual (hereinafter “Middle-Office Assistant 1”) (collectively “the Linkbrokers Team”) 

worked on Linkbrokers’ “Cash Desk,” executing orders to purchase and sell securities on behalf of 

their customers, primarily large foreign institutions and foreign banks, and purportedly charging 

small commissions—typically between a fraction of a penny and two pennies per share. Typically, 

the Cash Desk executed trades for Linkbrokers’ customers on a “riskless principal” basis.2

 That is, 

the customer gave the Cash Desk the order, the order was filled in the market under Linkbrokers’

name, then allocated to the customer. Thus, typically, Linkbrokers facilitated the transactions in 

exchange for the agreed-upon commission, and, essentially, served as an intermediary for others 

who assumed the market risk. 

The scheme was devious and difficult for Linkbrokers’ customers to detect, in part because 

the Linkbrokers Team selectively engaged in it when the volatility in the market was sufficient to 

conceal the fraud from the customer. The Linkbrokers Team fraudulently charged customers over 

$18 million, representing approximately 40% of the Cash Desk’s earnings generated for 

Linkbrokers during the relevant time period.

After receiving and executing orders on behalf of customers, Reyftmann, Chouchane, or 

Leszczynski routinely evaluated each transaction to determine whether they could make an 

additional or “secret” profit for Linkbrokers above the commission to be charged to the customer. 

Reyftmann, Chouchane, or Leszczynski—with the assistance of Condron or Middle-Office 

Assistant 1—considered other transactions in the relevant security occurring in the seconds to 

minutes before and after the actual trade executed. Where the price fluctuated sufficiently to 

conceal the fraud from customers, Reyftmann, Chouchane, or Leszczynski instructed Condron or 

Middle-Office Assistant 1 to record, on Linkbrokers’ internal records, a false execution price that 

 1 The findings herein are made pursuant to Respondent’s Offer of Settlement and are not binding 

on any other person or entity in this or any other proceeding.

2 In general, a “riskless principal” trade occurs when a broker-dealer, after receiving a customer 

order to buy (or sell) a security, buys (or sells) the security for its own account from (or to) 

another person in a contemporaneous offsetting transaction and then allocates the shares to the 

customer order.
3

included a secret profit for Linkbrokers. Then, Linkbrokers charged the customer the inflated price 

while also charging the agreed-upon commission. In that way, Linkbrokers received not only the 

actual commission charged, but also the fraudulent secret profit that Reyftmann, Chouchane, or 

Leszczynski, with assistance from Condron or Middle-Office Assistant 1, embedded in the price 

reported to the customer.

Brokers have a fundamental obligation to treat customers fairly. Customers, even 

sophisticated entities, rely on their brokers to execute orders at the most favorable terms reasonably 

available under the circumstances, taking into account the price and the customer’s instructions, 

among other factors. In return for the services provided, the customer pays the broker the agreed 

upon compensation. When a broker represents that it will act as an agent for the customer and 

negotiates the compensation the customer will pay on transactions, if the broker then imbeds an 

undisclosed markup or markdown in the price reported and charged to the customer, it violates the 

law, injures its customer, unnecessarily increases the customer’s costs, and undermines the trust 

upon which the broker-customer relationship is founded.

Leszczynski, Chouchane, and Condron have pled guilty to criminal charges arising from 

the conduct discussed herein. In addition, in SEC v. Leszczynski, et al., Civil Action No. 12-cv07488 (S.D.N.Y.), the Court entered judgments against Leszczynski, Chouchane, and Condron, 

permanently enjoining them from violating Section 17(a) of the Securities Act of 1933 (“Securities 

Act”) and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. In the judgments, 

Leszczynski was ordered to disgorge $1,500,000; Chouchane was ordered to disgorge $2,007,408 

plus prejudgment interest of $442,169; and Condron was ordered to disgorge $168,336 plus 

prejudgment interest of $39,339. The Court reserved the issue of whether to impose a civil penalty 

on these defendants. Acknowledging the facts to which they have admitted as part of their guilty 

pleas in parallel criminal cases, Leszczynski, Chouchane, and Condron consented to the entry of 

these judgments.

Linkbrokers is liable for the conduct of the members of the Linkbrokers Team. As such, 

Linkbrokers willfully violated Section 15(c)(1) of the Exchange Act.

B. Respondent

1. Linkbrokers is a limited liability company formed under the laws of Delaware. 

During the relevant period, Linkbrokers’ principal place of business was in New York, New 

York. It has been registered with the Commission as a broker-dealer since 2003. Linkbrokers 

ceased acting as a broker-dealer in April 2013 and will withdraw its broker-dealer registration

following this settlement.

C. Other Relevant Persons

2. Gregory Reyftmann (“Reyftmann”), age 40, was a sales broker and supervisor at 

Linkbrokers from February 2005 until June 2010. During that period, Reyftmann was the 

head of the Cash Desk and responsible for supervising Chouchane, Leszczynski, Condron, 
4

and others. He is a defendant in the related case SEC v. Leszczynski, et al., No. 12-cv-07488 

(S.D.N.Y.). He has not appeared to defend that action.

3. Benjamin Chouchane (“Chouchane”), age 40, was a sales broker at Linkbrokers

from February 2005 until December 2010. He pled guilty in a criminal case arising from the 

same conduct discussed herein, United States v. Leszczynski, No. 12-cr-00923 (S.D.N.Y.). He 

was sentenced to serve two years in prison, serve two years of supervised release, and pay $5 

million in restitution. In addition, he was a defendant in the related case SEC v. Leszczynski, 

et al., Civil Action No. 12-cv-07488 (S.D.N.Y.).

3

 

4. Marek Leszczynski (“Leszczynski”), age 44, was a sales broker at Linkbrokers

from March 2005 until December 2010. He pled guilty in a criminal case arising from the 

same conduct discussed herein, United States v. Leszczynski, No. 12-cr-00923 (S.D.N.Y.). He 

was sentenced to serve eighteen months in prison, serve two years of supervised release, and 

pay $1.5 million in restitution. In addition, he was a defendant in the related case SEC v. 

Leszczynski, et al., Civil Action No. 12-cv-07488 (S.D.N.Y.).

5. Henry A. Condron (“Condron”), age 35, was a sales trader and middle-office 

assistant at Linkbrokers from February 2005 until October 2010. He pled guilty in a criminal 

case arising from the same conduct discussed herein, United States v. Condron, No. 12-cr-768 

(S.D.N.Y.). He was sentenced to serve eighteen months of probation and pay $207,675 in 

restitution. In addition, he was a defendant in the related case SEC v. Leszczynski, et al., Civil 

Action No. 12-cv-07488 (S.D.N.Y.).

6. Middle-Office Assistant 1 worked at Linkbrokers from November 2004 until 

April 2011. For most of the relevant period, he worked as a middle office assistant and sales 

trader on the Cash Desk.

D. Facts

7. During the relevant time period, Linkbrokers acted as an interdealer broker for 

institutional customers dealing in equities products, both cash and derivatives. 

8. Linkbrokers established its Cash Desk in February 2005. The Cash Desk 

executed trades in U.S. and Canadian stocks. Its customers were primarily large foreign 

institutions and foreign banks. Typically, Linkbrokers operated as an agent and executed

large volumes of securities trades on behalf of customers for low commissions. The Cash 

Desk typically did not hold any securities itself. The Cash Desk was one of several desks at 

Linkbrokers.

9. Linkbrokers marketed and advertised itself as an agency-only business. For 

example, in marketing materials distributed on March 8, 2007, Linkbrokers represented that 

 3 The judgments against Chouchane, Leszczynski, and Condron in this civil action will be 

discussed in more detail below in Section III, part D (“Facts”).
5

“Link acts as a fiduciary in all transactions. Link trades on an agency basis in transactions 

with the sole purpose of providing best execution.” In separate marketing materials

distributed on January 4, 2007, Linkbrokers further stated that it provided “unparalleled 

execution without the conflicts of investment banking and proprietary trading.”

10. Linkbrokers’ internal records show that, for the majority of its customers, the 

Cash Desk was to charge its customers flat commission rates between $0.005 per share and 

$0.02 per share. 

11. Reyftmann, Chouchane, Leszczynski, Condron, and Middle-Office Assistant 1, 

collectively known as the Linkbrokers Team, were employees of Linkbrokers and were acting 

in the course and scope of their employment when they engaged in the improper conduct 

described herein. Linkbrokers is liable for the conduct of the members of the Linkbrokers 

Team.

12. Reyftmann, Chouchane and Leszczynski were “sales brokers” on the Cash Desk 

and were responsible for finding customers, developing relationships, negotiating commission 

rates, taking orders from customers, and communicating with customers regarding their orders 

and Linkbrokers’ execution of those orders. Reyftmann also supervised the Cash Desk during 

the relevant period. 

13. Condron and Middle-Office Assistant 1 were “sales traders” on the Cash Desk 

who entered orders they received from the sales brokers into systems for execution. 

14. Condron and Middle-Office Assistant 1 also served as “middle-office assistants.” 

As middle-office assistants, Condron and Middle-Office Assistant 1 maintained and updated 

Linkbrokers’ internal “trade blotter” (hereafter “Trade Blotter”), a spreadsheet generated from 

Linkbrokers’ proprietary software program which contains detailed information about trades 

executed by the Linkbrokers Team, including the names of the customers and execution 

prices. The Trade Blotter contained three price fields: (1) the actual “execution price”

received by Linkbrokers; (2) the “gross price” – the price that included the undisclosed 

markup/markdown; and (3) the “net price” – the gross price plus the agreed-upon commission 

rate. The Linkbrokers Team used the Trade Blotter to record profits from the unlawful 

scheme.

15. In addition, as middle-office assistants, Condron and Middle-Office Assistant 1 

reported customer trades to Linkbrokers’ clearing firm (either through a transfer via 

Linkbrokers’ proprietary software program or directly), reviewed trade settlement by the 

clearing firm, calculated daily profit and loss, and sent trade recaps and/or trade confirmations 

via email to customers. 

16. Depending on the customer’s preference, Linkbrokers, through Reyftmann, 

Chouchane and Leszczynski, accepted customer orders by telephone, instant message, or 

email. The Linkbrokers Team also confirmed trades to customers by telephone, instant 

message, email or mail, depending on the customer’s preference. 
6

Leszczynski, Chouchane, And Condron Have Admitted To Conduct That Violates 

The Securities Laws

17. In SEC v. Leszczynski, et al., Civil Action No. 12-cv-07488 (S.D.N.Y.), the Court 

entered judgments against Leszczynski, Chouchane, and Condron, permanently enjoining 

them from violating Section 17(a) of the Securities Act of 1933 and Section 10(b) of the 

Exchange Act and Rule 10b-5 thereunder. This action arose from the same conduct at issue in 

the criminal cases, United States v. Leszczynski, No. 12-cr-00923 (S.D.N.Y.) and United 

States v. Condron, No. 12-cr-768 (S.D.N.Y.), in which Leszczynski, Chouchane, and Condron 

each pled guilty to criminal charges.

18. In SEC v. Leszczynski, Leszczynski was ordered to disgorge $1,500,000; 

Chouchane was ordered to disgorge $2,007,408 plus prejudgment interest of $442,169; and 

Condron was ordered to disgorge $168,336 plus prejudgment interest of $39,339. The Court 

reserved the issue of whether to impose a civil penalty on these defendants.

19. In consenting to the judgments in SEC v. Leszczynski, Leszczynski, Chouchane, 

and Condron each acknowledged having admitted, in connection with his guilty plea, to 

certain conduct. That conduct constitutes violations of Section 17(a) of the Securities Act and 

Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.

20. Leszczynski admitted:

a. He made false statements to customers in connection with purchases and sales 

of securities;

b. He added undisclosed markups to customer trades; and

c. He sent false execution prices to customers and failed to disclose the markups.

21. Chouchane admitted:

a. He made false statements to customers in connection with purchases and sales 

of securities;

b. He caused commissions to be recorded into trading records that were in excess 

of the commissions agreed-upon by customers;

c. He caused false trading confirmations to be generated and sent to various 

customers; and 

d. He enabled Linkbrokers to receive undisclosed trading profits beyond the 

legitimate trading commissions to which it was entitled, resulting in lucrative 

performance bonuses for himself and others.
7

22. Condron admitted:

a. He caused commissions to be recorded into trading records that were in excess 

of the commissions agreed upon by customers;

b. He caused false trading confirmations to be generated and sent to various 

customers; and

c. He enabled Linkbrokers to receive undisclosed trading profits beyond the 

legitimate trading commissions to which it was entitled, resulting in lucrative 

performance bonuses for him and others.

Linkbrokers Generated Significant Profits Through The Undisclosed 

Markups/Markdowns

23. During the relevant period, the Cash Desk generated approximately $47 million in 

gross revenue for Linkbrokers. Approximately 40% of that revenue—over $18 million—was 

attributable to the markups/markdowns that Linkbrokers failed to disclose to its customers. 

The Linkbrokers Team added undisclosed markups/markdowns to more than 36,000 customer 

transactions, approximately one-third of the total customer transactions placed through the 

Cash Desk over a period of at least four years. And more than 3,300 of those transactions 

were marked up or down so that customers paid 1,000% or more of the disclosed commission

charged the customer.

24. During the relevant period, Linkbrokers paid millions of dollars in bonuses to 

Reyftmann, Chouchane, and Leszczynski based on the revenue derived from the Cash Desk. 

The Undisclosed Markups/Markdowns

25. The Linkbrokers Team concealed the markups/markdowns from Linkbrokers’ 

customers by, among other things, misrepresenting execution prices to the customers, and 

omitting information relating to markups/markdowns. 

26. In addition, the Linkbrokers Team opportunistically engaged in adding 

undisclosed markups/markdowns to trades when they thought the particular customer would 

not detect it, frequently taking advantage of market volatility to conceal the conduct.

27. The undisclosed markups/markdowns ranged anywhere from a few dollars to 

$228,822 per transaction. 

28. The markup/markdown scheme worked in the following way: 

a. A sales broker received a customer order either by telephone, instant message, 

or email. 
8

b. The sales broker gave the order to a sales trader to execute. 

c. The sales trader executed the trade. 

d. After the order was executed, a middle-office assistant recorded the actual 

execution price on the Trade Blotter and informed the sales broker of the 

execution. 

e. Shortly after the trade was executed, the sales broker examined other market 

executions in or around the time of the actual execution, to determine whether 

the stock price fluctuated. If the stock price’s fluctuation was favorable to 

Linkbrokers and sufficient to conceal the fraud from Linkbrokers’ customer, 

the sales broker instructed the middle-office assistant to record a false 

execution price in the gross price field on their internal Trade Blotter. 

f. A member of the Linkbrokers Team reported the false execution price and the 

commission to the customer, and recorded the total charged to the customer in 

the net price field on their internal Trade Blotter.

29. Frequently, the Linkbrokers Team provided the false and/or misleading 

information through trade recaps communicated to customers by telephone, instant message, 

or email. The Linkbrokers Team also sent, or caused to be sent, trade confirmations 

containing the false and/or misleading information to some customers.

Examples Of The Markups/Markdowns

30. On September 29, 2008 at 3:54 p.m., a customer placed an order by telephone 

with Leszczynski to sell 90,000 shares of Citigroup, Inc. (“C”). Linkbrokers executed the 

trade at 3:56 p.m., selling 90,000 shares of C on the customer’s behalf at an average price of 

$19.1311 per share. The Trade Blotter reflects an execution price of $19.1311, a gross price 

of $17.7500, and a net price of $17.7435. At 5:01 p.m., Middle-Office Assistant 1 generated, 

and emailed to the customer, a trade confirmation containing the false execution price of 

$17.7500 per share. The commission for this transaction was $0.0065 per share, resulting in a 

total commission of $585 for the trade, which Linkbrokers charged and disclosed to the 

customer. However, Linkbrokers, and the Linkbrokers Team, failed to disclose the additional 

markdown of $124,299, thereby taking this undisclosed profit for Linkbrokers at the expense 

of its customer. 

31. On February 27, 2007 at 3:36 p.m., a customer emailed Chouchane an order to 

buy shares of Bristol-Myers Squibb Co. (“BMY”). Linkbrokers executed the trade, 

purchasing 32,100 shares of BMY stock on the customer’s behalf at an average price of 

$26.3956 per share. The Trade Blotter reflects an execution price of $26.3956, a gross price

of $26.4356, and a net price of $26.4456. At 7:02 p.m., Chouchane emailed the customer a 

trade recap confirming the trade at the false execution price of $26.4356 per share. The 
9

commission for this transaction was $0.01 per share, resulting in a total commission of $321 

for this trade, which Linkbrokers charged the customer. However, Linkbrokers, and the 

Linkbrokers Team, failed to disclose the additional markup of $1,284, thereby taking this 

undisclosed profit for Linkbrokers at the expense of its customer.

32. On September 16, 2008 at 3:23 p.m., a customer placed an order by telephone 

with Leszczynski to sell 350,000 shares of American International Group, Inc. (“AIG”). 

Linkbrokers executed the trade, selling 350,000 shares of AIG at an average price of $4.3709

per share. The Trade Blotter reflects an execution price of $4.3709, a gross price of $4.3629, 

and a net price of $4.3554. At 3:26 p.m., Leszczynski confirmed the trade by telephone to the 

customer at the false price of $4.3629 per share. The commission for this transaction was 

$0.0075 per share, resulting in a total commission of $2,625 for this trade, which Linkbrokers 

charged the customer. However, Linkbrokers, and the Linkbrokers Team, failed to disclose 

the additional markdown of $2,800, thereby taking this undisclosed profit for Linkbrokers at 

the expense of its customer.

33. On October 8, 2007, Linkbrokers received a customer order to sell shares of 

Apple, Inc. (“AAPL”). From 9:36 a.m. until 9:45 a.m., Linkbrokers executed the trade, 

selling 40,000 shares of AAPL on the customer’s behalf at an average price of $164.1475 per 

share. The Trade Blotter reflects an execution price of $164.1475, a gross price of $164.1225, 

and a net price of $164.1160. At 4:26 p.m., Condron generated, and emailed to the customer, 

a trade confirmation containing the false execution price of $164.1225 per share. The 

commission for this transaction was $0.0065 per share, resulting in a total commission of 

$260 for the trade, which Linkbrokers charged and disclosed to the customer. However, 

Linkbrokers, and the Linkbrokers Team, failed to disclose the additional markdown of $1,000, 

thereby taking this undisclosed profit for Linkbrokers at the expense of its customer.

Linkbrokers Generated Additional Profits

By Stealing Portions Of Trades From Its Customers

34. In addition to the markups/markdowns, at times, the Linkbrokers Team used a 

second method to secure illicit profits at the expense of Linkbrokers’ customers. Specifically, 

where a customer placed a limit order and there was a favorable intraday price movement in 

the price of the security, the Linkbrokers Team would sometimes take advantage of that 

movement to steal a portion of a favorable trade for Linkbrokers. 

35. A “limit order” refers to an order to buy or sell a security at a specific price or 

better. For example, a customer could place a limit order to buy 100 shares of ABC stock at a 

price not greater than $10.00 per share. If the broker can fill the order at that price or better, it 

should do so. But if the price of ABC stock is above the price specified by the customer in the 

limit order, the shares will not be purchased. 

36. On one or more occasions, after accepting and executing a customer’s limit order, 

the Linkbrokers Team did not immediately report the transaction to the customer. Rather, the 

sales broker then looked for an opportunity to buy or sell that same stock at a lower or higher 
10

price than the price at which the customer’s trade was executed. If the opportunity to get a 

superior execution price existed, the sales broker instructed a middle-office assistant to buy 

the stock at a lower price than the execution price, or to sell the stock at a higher price than the 

execution price—taking the difference (or spread) between the two execution prices for 

Linkbrokers. 

37. The middle-office assistant, rather than properly recording the actual execution 

price and quantity of the customer’s original transaction in the Trade Blotter, entered a partial 

fill into the Trade Blotter. 

38. Afterwards, the sales broker and/or the middle-office assistant reported to the 

customer that only part of the order was executed.

39. In this way, the Linkbrokers Team used the customer’s funds to conduct a riskfree transaction profiting Linkbrokers, without the customer being aware of what Linkbrokers 

was doing. 

Example Of A Partially Stolen Trade 

40. On April 26, 2007, Linkbrokers received a customer order to sell shares of 

Qualcomm, Inc. (“QCOM”). From 2:48 p.m. until 2:49 p.m., Linkbrokers executed the trade, 

selling 22,576 shares of QCOM on the customer’s behalf at an average price of $45.7500. At 

3:41 p.m., Linkbrokers bought back 3,000 shares—shares that should have been allocated to 

the customer—for an average price of $45.3500. At 4:30 p.m. Leszczynski falsely reported to 

the customer that Linkbrokers was only able to sell 19,576 shares for the customer and was 

not able to fill the remaining shares ordered by the customer. Specifically, Leszczynski 

stated: “Remaining balance cancelled as stock didn’t trade @ the limit.” At 4:40 p.m., despite 

having sold 22,576 shares, Linkbrokers allocated sell executions representing only 19,576 

shares of QCOM to its customer for a gross execution price of $45.7500 per share. 

Linkbrokers kept an additional secret profit of approximately $1,200 on the purchase of the 

3,000 shares for itself. In total, Linkbrokers recognized approximately $1,335 in profits from 

the transaction while disclosing a commission of $135.07 to the customer. 

Deceptive Conduct To Facilitate The Scheme

41. In order to perpetuate the scheme described above, the Linkbrokers Team

engaged in a range of deceptive conduct. For example, at the inception of the Cash Desk, in 

February 2005, Condron and Reyftmann coordinated with employees of Linkbrokers’ IT staff 

to create a function within Linkbrokers’ proprietary software to facilitate the deceptive 

scheme. 

42. On February 7, 2005, a Linkbrokers IT specialist emailed Reyftmann, Condron, 

and others and informed them that he named the “Extra” field in the Trade Blotter the “gross 

price” field. He also warned that if they wanted to enter a different gross price than execution 
11

price that the gross price field had to be populated after the execution price field was 

populated. 

43. In other emails, dated February 7, 2005, a Linkbrokers executive described to 

Condron and Reyftmann, among others, that Linkbrokers’ proprietary software has two 

different commission fields—one for actual total commission charged and one for the 

commission amount that would be provided to the customer. 

44. Condron also emailed a Linkbrokers IT Specialist on April 10, 2006, to ask him to 

fix Linkbrokers’ proprietary software system to ensure that the customer will “never see [the 

execution price]” on any customer statements or trade confirmations. (emphasis added). The

following day, the Linkbrokers IT Specialist responded to Condron’s email, which included 

Reyftmann, Middle-Office Assistant 1, Linkbrokers’ Chief Compliance Officer, and another 

Linkbrokers IT specialist, and explained that he “unchecked” the execution price field, but left 

a check box next to the field “in case you ever might want” to disclose the execution price. 

Linkbrokers Acted With Scienter

45. Among other things, Linkbrokers authorized the Linkbrokers Team to interact 

with customers, agree upon commission rates to be charged for the services provided, and 

communicate the details of the transactions to the customers.

46. When engaging in the conduct described herein, the members of the Linkbrokers 

Team were employees of Linkbrokers and acting within the scope of their authority. 

Linkbrokers is liable for the conduct of the members of the Linkbrokers Team.

47. Reyftmann, Chouchane, and Leszczynski knew that the prices and/or 

commissions that they and Linkbrokers confirmed to their customers, either orally or in 

writing, were false because they knew the prices at which the transactions were actually 

executed and they created the fictitious prices. And, where the Linkbrokers Team stole part or 

all of the customer’s trade, they knew that they were making misrepresentations to the 

customer when they represented, either orally or in writing, that Linkbrokers had been unable 

to fill a particular limit order in its entirety.

48. Condron knew or was reckless in not knowing that the confirmations he, the sales 

brokers, and Linkbrokers sent to customers contained false and/or misleading information and 

omitted the markups/markdowns. Condron received the false prices from the sales brokers 

and input them into Linkbrokers’ internal database and then printed the confirmations or 

emailed the trade recaps that contained the false prices and intentionally omitted the 

markups/markdowns. And, where Linkbrokers stole part or all of the customer’s trade, 

Condron knew that he was making misrepresentations to the customer when he represented, 

either orally or in writing, that Linkbrokers had been unable to fill a particular limit order in 

its entirety.
12

Linkbrokers Made Material Misrepresentations And Omissions

Regarding Its Execution Of Customers’ Orders 

49. The Linkbrokers Team, through telephone conversations, instant messages, 

emailed trade recaps, and trade confirmations sent to customers, disclosed false execution 

prices, false order fills, and inaccurate fees charged to customers and omitted to disclose 

significant markups/markdowns embedded in the execution prices disclosed to the customers 

and that Linkbrokers stole portions of the customers’ trades for itself. 

50. In addition, contrary to express and implied representations that it would provide 

its customers with best execution, Linkbrokers knew or was reckless in not knowing that it 

failed to provide its customers with best execution because the Linkbrokers Team did not 

provide its customers with the best available prices. While the Linkbrokers Team executed 

the trades in the marketplace, they gave their customer a worse price than they had obtained

by adding in the undisclosed markup/markdown. Not only did Reyftmann, Chouchane, and 

Leszczynski know that there were better prices available, they had obtained them. But they 

gave the fictitious and inferior prices to their customers to take the difference between actual 

and better execution and the fictitious execution price for Linkbrokers.

51. Finally, the Linkbrokers Team accepted and executed customer orders, then 

misappropriated a portion of the trade for Linkbrokers’ own secret profit. Rather than 

reporting the full transaction to the customer, the sales brokers looked for an opportunity to 

buy or sell that same stock at a lower or higher price than the execution. After executing 

another transaction for Linkbrokers’ benefit, the Linkbrokers Team caused false reports to be 

provided to the customer that only part of the order was executed.

E. Violation

52. As a result of the conduct described above, Linkbrokers willfully violated Section 

15(c)(1) of the Exchange Act, which prohibits fraudulent conduct by a broker-dealer in 

effecting, inducing or attempting to induce any securities transaction. 

IV.

In view of the foregoing, the Commission deems it appropriate and in the public interest to 

impose the sanctions agreed to in Respondent’s Offer.

Accordingly, pursuant to Sections 15(b) and 21C of the Exchange Act, it is hereby 

ORDERED that:

A. Respondent Linkbrokers cease and desist from committing or causing any violations 

and any future violations of Section 15(c) of the Exchange Act. 

B. Respondent Linkbrokers is censured. 
13

C. Respondent shall, within 14 days of the entry of this Order, pay disgorgement of 

$14,000,000 to the Securities and Exchange Commission. If timely payment is not made, interest 

shall accrue pursuant to SEC Rule of Practice 600. Payment must be made in one of the following 

ways: 

(1) Respondent may transmit payment electronically to the Commission, which will 

provide detailed ACH transfer/Fedwire instructions upon request;

(2) Respondent may make direct payment from a bank account via Pay.gov through the 

SEC website at http://www.sec.gov/about/offices/ofm.htm; or 

(3) Respondent may pay by certified check, bank cashier’s check, or United States postal 

money order, made payable to the Securities and Exchange Commission and handdelivered or mailed to: 

Enterprise Services Center

Accounts Receivable Branch

HQ Bldg., Room 181, AMZ-341

6500 South MacArthur Boulevard

Oklahoma City, OK 73169

Payments by check or money order must be accompanied by a cover letter identifying Linkbrokers

as a Respondent in these proceedings, and the file number of these proceedings; a copy of the 

cover letter and check or money order must be sent to G. Jeffrey Boujoukos, Associate Regional 

Director, Division of Enforcement, Securities and Exchange Commission, One Penn Center, 1617 

JFK Boulevard, Suite 520, Philadelphia, PA 19103. 

By the Commission.

Jill M. Peterson

Assistant Secretary