Matthew Goldstein
To date, Sassano has not been charged with any wrongdoing in the mutual fund investigation. At Oppenheimer, he continues to work, unlike dozens of other former brokers who were caught up in the scandal at A.G. Edwards(AGE Quote - Cramer on AGE - Stock Picks), Bear Stearns(BSC Quote - Cramer on BSC - Stock Picks), KeyCorp's(KEY Quote - Cramer on KEY - Stock Picks) McDonald Investments and Merrill Lynch(MER Quote - Cramer on MER - Stock Picks). (Oppenheimer & Co. is unrelated to OppenheimerFunds.)
But securities regulators are taking a close look at the broker because of his reputation on Wall Street as someone with a big list of market-timing customers and his ties to other brokers implicated in the scandal. New York Attorney General Eliot Spitzer's office has subpoenaed records from Oppenheimer to learn more about how Sassano carved out his lucrative niche putting fast money together with mutual funds that could be market-timed. Investigators at the NASD also recently questioned a former A.G. Edwards broker in Boston about market-timing trades he allegedly made for Atlantique Capital Advisors, a defunct $200 million hedge fund that Sassano invested in and helped organize. Additionally, TheStreet.com has learned that the Securities and Exchange Commission has asked a number of mutual fund companies to scour their internal emails for any references to Sassano and his hedge fund clientele as part of its investigation. Sassano could not be reached for comment. His attorney, Ira Lee Sorkin, a noted white-collar criminal defense lawyer, declined to comment. Spitzer's office and the SEC declined to comment. Sources familiar with Sassano, including one of his customers, said the broker had arrangements with several mutual fund companies, including Sun Life Financial's(SLF Quote - Cramer on SLF - Stock Picks) MFS Funds and Kinetics Mutual. Sources said he conducted market-timing strategies in JW Seligman funds but without an arrangement with the fund manager. Officials with all three fund companies declined to comment. But all three funds have acknowledged permitting some customers to engage in market-timing in the past.
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