Swift Trade Inc. (STI) is offering students at U of T the opportunity to trade real money on the stock market in amounts ranging anywhere from $25 to $200,000.
But behind the appeal of this internship, there lie little-known facts about illegal activity in the company’s past.
STI is an international proprietary trading firm that trades companies’ capital on the stock market using online trading servers.
“It’s an unimaginable experience,” says Robert Schlaepfer, a 24-year-old U of T commerce graduate. He shares the rights to all Swift Trade Campus (STC) offices in Toronto with two other young entrepeneurs, Shawn Catena and Neal Roberts.
Ths first STC office opens at the corner of Bloor and Avenue Road this year, and they’re advertising internships for U of T undergrads. According to Schlaepfer, interns will go through a brief training period of a few days where they will work on trade simulators, after which they will immediately begin trading STI’s money in the thousands.
“Disasters can happen and you can lose a lot of money,” says Schlaepfer. “Sometimes there’s nothing you can do about it.” To keep losses to a minimum, interns will make 80-90 transactions per day, as opposed to the company average of 250. Catena, who was head trainer for the Toronto STI trading floor, will be watching every student’s screen. If a student is in a difficult spot and Catena misses it, STI’s software is supposed to take control to cut losses.
“This model has been proven to work,” says Schlaepfer. If the STC venture is successful, they plan to open up more offices in campuses across the country, including York and Ryerson.
The advantages of an STC internship for students hoping to get jobs in business is undeniable. Students who do well will have a guaranteed job with Swift Trade when they graduate at any of their 38 offices open on every continent except Africa, and could potentially receive salaries in the six-figure range.
But with major corporate scandals such as Enron still making headlines, prospective interns may be unsettled by STI’s track record.
In 2002, the National Association of Securities Dealers issued a press release stating that STI president Peter Beck and co-founder Joseph Ianni had been fined for engaging in illegal trading. Swift USA and Beck were jointly censured and fined $75,000, and were required to give up profits from fictitious “wash” sales.
In a “wash” transaction, two companies agree to make a swap of exactly the same amount, often to make revenue appear to be growing more rapidly than it actually is, a tactic which can fool investors. At STI, a wash was used to attain profit by selling the assets of a client back to that same client.
“They made a lot of money,” admitted Schlaepfer. “In their defense, they did not know it was illegal, and it was partially somebody else’s fault. That’s why the fine was so low. For a company this size, if that’s their only fine in the market, that’s pretty good.
“The easiest thing to say I guess is ‘shit happens.'”
For ethically conscious commerce students, this might not be reassuring enough. For others, such facts merely attest to the realities of the business world, and the benefits will prove to be alluring enough to quell any nervousness about trading real money.
“It’s commercially impossible for us to make money cheating…If we put our minds to it maybe, but we’ve too much to lose.”
