The criminal trial of Jesse C. Litvak in federal court in New Haven, Conn., next month will help to shine a light on the line between savvy sales tactics and securities fraud in the murky world of mortgage-bond deals, the Wall Street Journal reported today. It could also have a big impact on a wide-ranging probe into whether banks cheated mortgage-bond clients in the years after the financial crisis, legal experts said. Prosecutors allege Litvak, a former Jefferies LLC trader, cheated his clients out of a total of more than $2 million. Litvak is accused of using dishonest sales tactics to inflate the prices the clients were willing to pay for the bonds, including inventing imaginary sellers, and lying about how much Jefferies had paid for the bonds.
