Short-selling trader settles with SEC

0 Comments | USA TODAY, April, 2008 | by Greg Farrell

In recent years, it's become fashionable for CEOs to blame short-sellers for any dip in their companies' share prices. But once in a while, it's actually true.

The Securities and Exchange Commission settled a case Thursday with a short-seller who e-mailed a negative rumor about a company one afternoon last year, then profited when the stock dropped 17% in 30 minutes.

The target of the e-mail attack was Alliance Data Systems, a credit card transaction processor that agreed to be acquired by private-equity firm Blackstone Group last May for $81.75 a share.

According to an SEC complaint filed in New York, Paul Berliner, a 32-year-old trader at the Schottenfeld Group, sent out e-mails and instant messages to 31 traders shortly after 1 p.m. on Nov.29,...