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Regulatory Sanctions

For Eaton Vance Portfolio Manager, It Was 'Game, Set and Matched-Trades' - SEC

May 8, 2017

The SEC charged Kevin Amell, a Massachusetts-based portfolio manager with Eaton Vance, with diverting at least $1.95 million to his personal brokerage account from a fund over which he had trading authority. The name of the fund was not identified.


THE DEFENDANT.    Amell, 45, a resident of Hingham, MA, was an employee of Eaton Vance from 2009 until his resignation in April 2017. After starting out as an options trader, Amell later served as a VP and Portfolio Manager for one of its registered investment companies (RIC).


ACCORDING TO THE SEC COMPLAINT.    Over a 2-year period, from December 2014 through January 2017, Amell diverted at least $1.95 million from the Eaton Vance fund to himself by pre-arranging at least 265 options trades between his personal brokerage account and the Fund’s brokerage accounts, over which he had trading authority.


Amell did so by carrying out a fraudulent matched-trades scheme in which he prearranged the purchase or sale of call options between his own account and the brokerage accounts of the fund at prices that were disadvantageous to the fund and advantageous to him. In one series of trades, involving Amazon securities, Amell allegedly generated a $23,000 profit for himself in less than 23 minutes at the fund’s expense.


Amell profited from his matched trades scheme, at the Fund’s expense, by either: (i) buying call options from the Fund at artificially low prices and selling them shortly thereafter at higher prices to 3rd parties; or (ii) purchasing call options from 3rd parties and selling them shortly thereafter to the Fund at artificially high prices.


The SEC, which is continuing its investigation, seeks disgorgement, interest and penalties. In a parallel action, the U.S. Attorney’s Office for the District of Massachusetts today filed criminal charges against Amell.