Bond trader who blew up Atlanta B-D found guilty in fraud case

investmentnews.com:

Keith Wakefield, the former head of municipal bond trading at the defunct IFS Securities Inc., was found guilty of securities and wire fraud Wednesday, according to a report from Law360, an online courthouse news service.

IFS Securities of Atlanta blew up in the summer of 2019 and was out of business by the beginning of the next year. IFS Securities catered to two types of businesses: independent financial advisors, and institutions and municipalities.

Wakefield was convicted in federal court in the Northern District of Illinois after a jury found he inflated commissions on his trades and entered false and unauthorized trades that caused $30 million in losses, according to the report. Initial reports from 2019 put the losses from the unauthorized trades closer to $10 million.

The case centered on Wakefield’s trading activity between 2017 and 2019, which he testified was not an effort to enrich himself but rather cover his hedges and fix significant mistakes he’d made while trading Treasuries and municipal bonds, according to Law360.

Wakefield’s attorney, Holly Blaine, did not return a call Thursday to comment about the report.

The owner of IFS Securities, Alex McKenzie, did not return a call Thursday to comment. McKenzie moved many IFS employees and financial advisors to another firm he owns, San Blas Securities, also in Atlanta.

In 2019, IFS Securities has 160 financial advisors. It also operated an advisory firm, IFS Advisory, which had $600 million in client assets at that time.

One attorney who followed the case said that Wakefield’s testimony that he was trying to fix mistakes and made more bad trades as a result didn’t stack up.

“It was $30 million that was gone,” said Scott Silver, a plaintiff’s attorney.