Robert Murphy, chief executive of
, the largest specialist on the
New York Stock Exchange
, resigned Thursday as vice chairman of the exchange's board.
Murphy's resignation comes at a time when the NYSE is locked in a bitter dispute with LaBranche over access to some of the trading firm's internal emails.
The NYSE wants the emails as part of its investigation into possible trading abuses by some of its specialist firms, including LaBranche. But LaBranche is refusing to turn over the emails, contending it's already turned over others and made its employees available for interviews with NYSE investigators.
The email dispute came to a head last month when the NYSE's enforcement division threatened to sanction the firm if it doesn't comply with the request.
Specialist firms like LaBranche are the engines that drive trading on the Big Board. The NYSE's seven specialists earn commissions on the trades they mediate and also generate big revenues from making stock trades for their own account. But specialists are not permitted to profit at the expense of their customers.
The NYSE is in the midst of a sweeping investigation to determine if specialist firms violated an exchange rule requiring them to "stand out of the way'' when a buyer and seller agree on a price for a stock. Specifically, NYSE investigators are looking into a number of instances in which specialists might have violated that rule by stepping in and buying stock from a seller at one price and then reselling it to a buyer at a slightly higher price.
LaBranche officials were unavailable for comment. A LaBranche press release announcing Murphy's resignation made no mention of either the email dispute or the NYSE investigation. A NYSE spokesman declined to comment.
LaBranche, a family owned business that went public in 2000, serves specialists in 600 Big Board stocks.
Besides LaBranche, investigators are believed to be looking into the trading activities of at least four other firms: Fleet Specialist, a division of
Spear Leeds & Kellogg unit,
Van Der Moolen
Bear Wagner Specialists
. In recent weeks, the NYSE has initiated settlement discussions with some of the firms.
In July, the NYSE fined and censured the specialist division of FleetBoston Financial for several violations, including failure to comply with the stand-aside rule, which stemmed from Fleet's handling of trading activity in
stock on June 27, 2002.
Earlier this year, Fleet suspended a floor specialist who handled trading in shares of