The US Securities and Exchange Commission has lodged a complaint against four people - including one chief compliance officer - for conducting a fraudulent unauthorised trading scheme through retail customer accounts at their SEC-registered brokerage firm.

According to the SEC's complaint, Jonah Engler of New York, Joshua Turney of California, Hector Perez of New Jersey and Barbara Desiderio of New Jersey ran a scheme to conduct voluminous unauthorised trading in more than 360 retail customers' accounts under the name of Global Arena Capital Corp, the New York broker-dealer with which they were associated but which was going out of business.

This unauthorized trading allegedly generated $2.4 million in unlawful markups, markdowns and commissions for their firm and resulted in more than $4 million in net losses for their HNW customers.

The complaint alleges that Engler, who indirectly owned and controlled Global, orchestrated the scheme and Turney and Perez, who were registered representatives at Global, carried it through with the help of Desiderio, Global's president, chief compliance officer and supervisor.

The SEC's complaint, filed in federal district court in Brooklyn, charges Engler, Turney and Perez with breaking the anti-fraud provisions of ss17(a)(1) and (3) Securities Act 1933 and s10(b) Securities Exchange Act 1934 (and Rule 10b-5(a) and (c) thereunder) and charges Desiderio with aiding and abetting the other three. The complaint goes on to ask for the 'disgorgement' of ill-gotten gains plus prejudgment interest, penalties and injunctive relief. An investigation is still in progress.