Stock Broker Fraud Attorneys

Salomon Smith Barney is a New York corporation with its principal place of business in New York, New York. Salomon Smith Barney is a broker-dealer registered with the Commission pursuant to Section 15(b) of the Exchange Act, and is a member of NASD and the New York Stock Exchange. Salomon Smith Barney engages in a nationwide securities business.

The Securities and Exchange Commission, together with state authorities and stock exchanges, have investigated alleged wrong doings at Salomon Smith Barney. Salomon Smith Barney, owned by Citigroup Inc., is a Wall Street investment house most notably known for its connection to the now bankrupt telecommunications giant, WorldCom.

Salomon Smith Barney and its star analyst, Jack Grubman, have been charged by the SEC, have been the center of congressional hearings into brokerage misconduct, and have faced criminal prosecution for their orchestration of an investment scam that cost investors over $9 billion. Conflicts of interest permeate the investment banking industry, mostly because investment bankers and research analysts reside under one corporate roof. It is alleged that for years analysts' research has been improperly influenced by pressure to issue positive research to attract underwriting and investment banking business. It is also alleged that Jack Grubman issued positive research in order to impress his boss into helping him get his children into a prestigious pre-school.

Grubman, formerly of AT&T, was employed as a "research analyst" at Salomon Smith Barney for an estimated annual salary of $20 million. Clients relied on his expertise in the telecommunications field and trusted his analytical skills. Grubman helped send WorldCom stock soaring by giving it high "buy" ratings even though he knew the company was facing bankruptcy. However, his real value to Salomon Smith Barney and the reason he was better paid than other Wall Street analysts, was his role as a dealmaker, a role that arose through his friendship and association with Bernie Ebbers, then chief executive of telecommunications group WorldCom. With Jack Grubman’s manipulation of the stock, WorldCom grew from a small player to the second largest telecommunications company in the world and it was not until late in 1999 that the lies were revealed. WorldCom filed for bankruptcy in July 2000 but not before its investors lost more than $7.5 billion. During this time, Jack Grubman watched WorldCom stock fall from $65 per share to $1 per share but still insisted that the stock had a "buy" rating.

The Justice Department and the Securities and Exchange Commission are investigating the accounting abuses, which have led to criminal charges against several former top executives. Grubman has since quit Salomon Smith Barney. NASD fined the brokerage $5 million to settle charges that his research was misleading and filed a complaint against Grubman.

Here is a list of some of the stocks analyzed by Jack Grubman:

• ATT
• Allegiance Telecom
• Broadwind
• Carrier 1
• Flag Telecom
• GTE
• Intermedia
• Level 3 Communications
• McCleod USA
• Metromedia
• Nextlink
• Pacific Gateway
• PSI Net
• Qwest
• Rogers Wireless
• Williams
• Winstar
• WorldCom
• XO Communications

UPDATE:

12/20/02 - Salomon Smith Barney's former star telecom analyst Jack Grubman has reached a settlement with the New York Attorney General's office that bars him from the securities industry for life and fines him $15 million.

THE RIGHT STOCK BROKER FRAUD ATTORNEY MAY BE YOUR BEST DEFENSE AGAINST CORPORATE INJUSTICE!