NEW YORK (AP) – A former Wall Street broker has pleaded not guilty to charges of duping investors into buying more than $1 billion in high-risk securities by making it look like the trades were backed by federally guaranteed student loans.
Julian Tzolov has been released on $3 million bond after entering the plea Friday in federal court in Brooklyn.
Prosecutors say the 35-year-old Tzolov and fellow Credit Suisse Securities broker Eric Butler stood to pocket higher commissions because the securities actually were tied to subprime mortgages.
Prosecutors say the scheme was exposed when the subprime market collapsed.
The 36-year-old Butler pleaded not guilty earlier this week to securities fraud, wire fraud and conspiracy. Both men are due in court Sept. 19.
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