NYSE Regulation Inc. today announced disciplinary action against the former head of one of its specialist firms.

The regulator announced the action against former president and chief supervisory specialist of Fleet Specialist Inc., Myles Gillespie, for failure to reasonably supervise certain specialists who committed interpositioning and trading ahead violations from September 2000 through June 2003.

NYSE Regulation censured, issued a fine of US$125,000, and barred Gillespie for three years from NYSE membership, allied membership, approved person status, and employment or association in any capacity with any NYSE member or member organization. He is also permanently barred from functioning in any capacity as a specialist or from supervising any specialists. Furthermore, he is barred from employment in any capacity on the Floor of the NYSE.

Disciplinary action has also been taken against Thomas Verdiglione, a former specialist with Van der Moolen Specialists USA , LLC, who, on certain occasions from May 2000 through June 2003, interpositioned his firm’s dealer account between matchable public orders or traded ahead of customer orders, thereby disadvantaging those orders.

NYSE Regulation also censured and permanently barred Verdiglione from employment in any capacity on the floor of the NYSE and from functioning in any capacity as a specialist or supervisor thereof.

In settling these charges brought by NYSE Regulation, Gillespie and Verdiglione neither admitted nor denied the allegations.

“The honesty and integrity of the trading floor is of utmost importance both to the market and to investors,” said Susan Light, senior vice president of Enforcement, NYSE Regulation. “NYSE Regulation has vigorously pursued disciplinary actions against specialists and clerks, as well as their supervisors, who abused the public trust and disadvantaged customer orders. Supervisors who have been notified of misconduct must thoroughly review each situation and take appropriate action.”

In addition to these Hearing Board Decisions, NYSE Regulation in December 2006 charged and is pursuing disciplinary actions against four former specialists for interpositioning and trading ahead misconduct, three former clerks and one present clerk for aiding and abetting these violations, and one former clerk who is presently a specialist for interpositioning, trading ahead, and aiding and abetting.