Shootings Spur Georgia to Open Probe of 2 Atlanta Brokerages

Georgia has launched an investigation into whether two Atlanta brokerages violated laws in dealing with a day trader whose shooting rampage is believed to have been sparked in part by market losses, officials said Tuesday.

Secretary of State Cathy Cox, Georgia’s chief securities regulator, said she issued subpoenas late Monday to Momentum Securities Inc. and All-Tech Investment Group. Trader Mark Orrin Barton killed nine people on July 29 in the firms’ Atlanta offices after killing his wife and two children days earlier. He later committed suicide.

Officials with the two companies were not immediately available for comment.

Barton’s outburst, one of the deadliest crimes ever in Atlanta’s modern history, was one of a series of mass killings that have fueled debate on U.S. gun laws and the constitutional right of Americans to bear arms.

Cox said she wants to know whether the brokerages adequately warned Barton and others about the risky nature of day stock trading, in which investors working with their own accounts try to capture a profit with moment-by-moment transactions.

She also wants to learn whether the firms knew Barton may have invested money for other people in violation of Georgia law requiring brokers to be licensed, and whether agents of the companies urged investors to borrow from each other or third parties or directly lent money, which could also be illegal depending on how the transactions took place.

Cox said her office is concerned that brokerages have an obligation to provide training and risk warnings to untutored players like Barton, who was a chemical supply salesman before becoming a day trader.

“If you look at millionaires, the Warren Buffetts of the world, you find long-term investors,” she said.

“You don’t have people saying, ‘I made my fortune in day trading’ because they don’t exist.”

Cox said All-Tech’s Internet site “promotes day trading as a viable career opportunity, as if this is a great lifestyle and you should give up your regular employment and throw it all away on day trading.”