| NEW YORK, March 27
NEW YORK, March 27 A former UBS AG
trader who became a cooperating witness in the U.S. government's
sweeping probe of bid-rigging in the $3.7 trillion municipal
bond market was sentenced to time served on Thursday.
Mark Zaino, a former director on UBS' municipal bond and
derivatives desk in New York, had pleaded guilty to conspiracy
and wire fraud charges in 2010, becoming the fourth person to
admit wrongdoing as part of the antitrust investigation.
The probe has resulted in numerous convictions and resulted
in $743 million of settlements with UBS, Bank of America Corp
, General Electric Co, JPMorgan Chase & Co
and Wells Fargo & Co. UBS' payment was $160 million.
U.S. District Judge Kimba Wood in Manhattan said Zaino's
eight years of cooperation with government investigators
justified the sentence.
"It is true that an investigation like this could not be
successful without someone like yourself," she said.
The Justice Department said that from October 2001 to March
2006, Zaino and his co-conspirators would decide in advance who
would win auctions of guaranteed investment contracts, which
public entities buy with the proceeds from municipal bond sales.
Zaino would then arrange for lowball bids to give the
appearance of competitive bidding, and for kickbacks to be
funneled to CDR Financial Products Inc, a Beverly Hills,
California broker that prosecutors said steered investment
agreements to financial firms.
CDR founder David Rubin was sentenced this month to two
years probation after pleading guilty to wire fraud and
conspiracy. He also cooperated with investigators.
"I live every day with regret and remorse," Zaino said.
Zaino, 39, testified against three former UBS executives
-Peter Ghavami, Gary Heinz and Michael Welty - who were
convicted in 2012 for participating in frauds related to
municipal bond proceed contracts.
Zaino also testified at the trial of three former GE bankers
- Steven Goldberg, Dominick Carollo and Peter Grimm. A federal
appeals court vacated their 2012 convictions last year, saying
the government waited too long to prosecute.
The case is U.S. v. Zaino, U.S. District Court, Southern
District of New York, No. 10-cr-00434.
(Reporting by Nate Raymond; Editing by Andrea Ricci)