22 Facts About Joseph Jett

Orlando Joseph Jett was born on 1958 and is an American former securities trader, known for his role in the Kidder Peabody trading loss in 1994.

Joseph Jett earned his bachelor's and master's degrees in chemical engineering at MIT and after working two years at GE Plastics went on to earn an MBA from Harvard Business School.

Joseph Jett had worked previously as a bond trader at Morgan Stanley for two years and at First Boston for eighteen months.

Therefore, in order to continue to appear profitable, Joseph Jett had to engage in more and more such trades, enough to both offset the losses on the settling trades plus additional trades to keep delivering profits.

Joseph Jett, who was previously a marginally profitable trader, started earning large bonuses once he began executing the trades that exploited the system flaw.

Computer specialists began noticing that none of Joseph Jett's supposed "trades" were ever consummated.

Joseph Jett recalled GE business leaders were so shaken by the size of the loss that they were willing to dip into the coffers of their own divisions to close the gap.

The report was released in August 1994 and concluded that Joseph Jett acted alone, but blamed the losses on a complete breakdown of the system of supervision at Kidder, particularly with regard to Ed Cerullo and Melvin Mullin.

In 1996, a NASD arbitration panel rejected Kidder Peabody's monetary claims against Joseph Jett and ordered the funds from Joseph Jett's personal accounts to be released.

The Securities and Exchange Commission investigated the losses from 1994 onward, and in 1998 released an initial ruling that Joseph Jett did not commit securities fraud, but charged him with a lesser record-keeping violation.

The SEC ordered Joseph Jett to forfeit his $8.2 million in bonuses associated with the false profits, fined him $200,000, and barred him from any future association with a securities broker or dealer.

In March 2004 the SEC finally ruled on the appeal, and concluded that, in addition to upholding the record-keeping violation, Joseph Jett had committed securities fraud.

Specifically, they found that Joseph Jett committed fraud by deliberately exploiting weaknesses in Kidder Peabody's automated trading records system in order to book fake profits of about $264 million.

The Commission re-affirmed the penalty that Joseph Jett forfeit $8.2 million in fraudulently-obtained bonuses, plus the fine of $200,000 and a lifetime ban from the securities industry.

Joseph Jett never appealed the 2004 SEC decision, even though he had the right to do so.

Joseph Jett sent another filing saying he was unaware of the 2004 decision being made and therefore had no chance to appeal.

The District Court rejected this when they found that Joseph Jett had been quoted in a New York Times article shortly after the 2004 decision was announced, saying that he was unconcerned with the SEC action since he was still legal to trade securities offshore.

Joseph Jett has written two books about his life and experience at Kidder Peabody.

Joseph Jett has claimed to operate a hedge fund called Cambridge Matrix Funds, domiciled in the British Virgin Islands.

Joseph Jett told The New York Times in 2004 that he gets between $4,000 and $8,000 per appearance on the lecture circuit.

Joseph Jett currently operates a firm called Jett Capital Management LLC According to its website, the firm offers asset management, advisory, and private equity services, though it is unclear how Jett is able to perform these functions while being permanently barred from the securities industry.

The France24 reporter said that Joseph Jett is running a financial consultancy domiciled offshore, which conducts its business from hired conference suites in New Jersey.