According to online Financial Industry Regulatory Authority ("FINRA") records as of November 30, 2011, Shawn Reilly, 34, of Congers, NY, first became registered in the securities industry in 1999 with PaineWebber and in 2004 joined UBS Securities LLC, where he remained until his discharge on April 20, 2011. FINRA's records reflect the reason for Reilly's discharge as:
MR. REILLY WAS TERMINATED FOR ENGAGING IN IMPROPER CONDUCT RESULTING IN EMPLOYEE WIRING NON-CUSTOMER UBS FUNDS TO HIS PERSONAL ACCOUNT AND ENGAGING IN ILLEGAL INTERNET GAMBLING ACTIVITY WHILE ON UBS PROPERTY.
Thereafter, FINRA initiated a regulatory investigation, which resulted in Reilly being suspended in July 2011 for failing to respond to requests by the regulator for information. In October 2011, FINRA converted the suspension to a bar.
According to federal prosecutors, from 1999 to April 2011, Reilly was employed at UBS, most recently at its Stamford, CT branch. From November 2007 through January 2010, Reilly was a Director in the firm's settlements group, where he oversaw activities including managing and maintaining suspense accounts, and ensuring accurate and timely payments.
Prosecutors charged that from about February 2009 to April 2011, Reilly was responsible for approximately 84 fraudulent wire transfers, which resulted in over $673,000 of company funds being wrongfully transferred to his personal accounts for his own benefit. This fraud was accomplished when Reilly causing his subordinates to unknowingly make false journal entries and fraudulent wire transfers. As noted in FINRA's records, prosecutors alleged that some of those diverted funds were used to pay Reilly's gambling debts.
On September 6, 2011, Reilly waived his right to indictment and pleaded guilty to one count of bank fraud.
On November 30, 2011, Reilly was sentenced in the United States District Court in Bridgeport, CT to 33 months of imprisonment, followed by three years of supervised release, and he was ordered to pay $673,447.47 in restitution.