Federal prosecutors are nearing a decision on whether to indict a top executive at AB Watley, the small daytrading firm that allegedly had illegal access to so-called squawk box communications at three big Wall Street firms, sources say. A decision on whether to indict the Watley executive will be made by March 17, say people familiar with the investigation. Three former brokers who were indicted last summer on charges they sold access to their firm's squawk box systems are scheduled to return to federal court in New York on March 17. The Watley executive in the prosecutorial crosshairs is Robert Malin, the New York-based brokerage's co-founder, president and vice chairman. Sources say prosecutors also are mulling whether to seek an indictment against Linus Nwaigwe, the firm's former compliance officer. In September, the Securities and Exchange Commission notified both men that they could face possible civil fraud charges stemming from their role in the squawk box matter. Lawyers for both Malin and Nwaigwe did not return telephone calls. Malin declined to comment. Nwaigwe could not be reached for comment. Last summer, prosecutors informally notified Nwaigwe that he could face indictment in the investigation, sources say. In recent weeks, prosecutors have interviewed a number people in deciding whether to pursue indictments against Watley officials. People familiar with the inquiry say one person interviewed was a former lawyer for the brokerage. Federal prosecutors declined to comment. But earlier this year, prosecutors told U.S. District Judge I. Leo Glasser that they anticipated filing a superseding indictment that would either add new defendants to the case or add additional charges against the three brokers, Timothy O'Connell, Kenneth Mahaffy Jr. and David Ghysels. An indictment against Malin could spell the end for Watley, which went public in 1999, when daytrading was all the rage. For many years, Watley's daytrading software was highly rated and popular with fast-fingered traders. A year ago, the firm reported having fewer than 5,000 online customers.