December 19, 2002 (PLANSPONSOR.com) - A former UBS
PaineWebber system administrator is facing chares of
sabotaging two-thirds of the company's computer systems to
crash its stock price, according to a CNET News.com
report.
Roger Duronio, currently facing
as much as 20 years in prison and fines of more
than $1.25 million,
is charged with one count
of securities fraud and one count of violating the
Computer Fraud and Abuse Act after causing
more than $3 million in damages when his “logic bomb”
computer virus went off March 4, causing 1,000 of the
company’s 1,500 computer to begin deleting files.
The indictment alleges that Duronio used the
company’s secure network to plant “logic bombs,”
destructive computer programs that are set to trigger at
a specific time, with instructions to delete all the
files stored on the systems at 9:30 am on every Monday in
March, April and May of 2002.
Duronio then left company on Feburary 22, 10 days
before the first trigger date. Around the same time,
Duronio purchased options to sell 31,800 shares of UBS
stock at an average strike price of $42.91.
However, the alleged attack failed to have the
desired effect, as UBS did not make it public at the time
and the company’s stock didn’t fall below $45.
December 18, 2002 (PLANSPONSOR.com) - While
participants in self-directed accounts left equity
investments alone during the third quarter, 95% of net new
assets were directed to the relative safe harbors of taxable
bonds, asset allocation funds, fixed income securities and
money market funds.
According to the Schwab Self-Directed Brokerage Account
(SDBA) Indicators, trading levels fell to an average of
just 2.1 trades during the quarter from 2.2 in
the
second quarter
, representing approximately one mutual fund trade and one
stock fund trade in self-directed brokerage accounts
(SDBAs), retirement plan brokerage accounts that offer plan
participants access to investments (stocks, mutual funds,
fixed income securities) outside of their core
holdings.
The average account positions in the SDBA accounts
tracked by Schwab with more than $5,000 invested remained
unchanged from the previous quarter, holding 6.5
securities; 3.1 stocks, 2.1 mutual funds, 1.1
cash/equivalent and 0.2 fixed income securities. The
average Personal Choice Retirement Account (PCRA) account
balance was $49,344, compared with $52,731 a quarter
earlier.
Over half (57.93%) of the net asset flows tracked by
Schwab went toward bond mutual funds, more than double the
amount the prior quarter.
The PIMCO Total Return bond fund again continued to
top the list of Top 10 mutual fund holdings, representing
4.20% of the total mutual fund assets. Bond funds
increased their hold on the top five mutual fund holdings,
now comprising 4 out of the top 5; up from three of the top
five in the second quarter.
The stock market slump continued to weigh on SDBA
investors, as it did with the overall market.
Evidence of this is asset allocation funds, fixed income
securities, money market funds and bond funds, accounting
for 95% of the net inflows among SDBA participants.In contrast, during the second quarter, small cap and
tech stocks accounted for nearly 25% of net new
assets.
Schwab noted for the first time since the SDBA
Indicators were introduced in the fourth quarter of 2001,
that there was an outflow of assets from large cap
(-14.18%) and small cap (-15.10%) equity funds. This
shift is especially prominent with small caps, which has
seen asset flow decline from 26.34% of net new assets in
the fourth quarter of 2001, to the 15.10% outflow this
quarter.
“REIT”ing The Rewards
For the second consecutive quarter, SDBA
participants shifted a significant percentage of assets
into Real Estate Investment Trusts (REITs) indicating a
continued trend that supports the growing popularity of
these products.
This quarter saw REITs garner a 227% increase in net
asset flows from the second quarter.
According to Schwab investors appear to be
attracted to REITs due to their high
dividend income and low correlation with broader
markets.
Popularity Poll
Among equity holdings, Viacom wrestled the top spot as
the most popular equity holding tracked by the SDBA
Indicators from Microsoft, representing 4.20% of the
total. Microsoft was second with nearly 3.87%, while
General Electric holdings comprised nearly 2.66%.
Among bond investments, after the PIMCO Total
Return holding,
PIMCO Real Return Bond (2.40% of the total assets),
PIMCO Low Duration (2.00%) and Fidelity Magellan (1.94%)
were next most popular.
New to the top 10 list was thePrudent Bear Fund, a “hybrid” fund specifically
designed for investors seeking to capitalize on long
periods of poor stock market performance during secular
bear markets, which represented the 10th most popular
fund with 0.71% of the total assets.
Schwab notes that among its 11,000 SchwabPlan PCRA
participants 62% of their assets are in the SDBA option,
with the remaining 38% invested in the core options of the
program.