The three men went on trial in Manhattan this year, but were cleared on some charges before the jury failed to agree on those that remained. They were charged in relation to the way that financial information was presented to investors shortly before the firm went bankrupt in 2012. Prosecutors have now decided that they will focus only on the more serious charges and only against two of the men, the former executive director, Stephen DiCarmine, and former chief financial officer, Joel Sanders. 

Deferred-prosecution

Under a deferred-prosecution agreement, Mr Davis will not make a plea or an admission of guilt, but will be cleared on the condition that he not commit any crime within a certain period. His lawyer Elkan Abramowitz said: 'He never should have been indicted in the first place.' 

Guilty plea offer

Lawyers on both sides were appearing before New York State Supreme Court Justice Robert Stolz. Assistant District Attorney Peirce Moser said that Mr DiCarmine, Mr Sanders and a fourth defendant being tried separately, Zachary Warren, had been offered the option to plead guilty on various counts of fraud. Lawyers for Mr DiCarmine and Mr Sanders said that the case should be thrown out. Mr Warren's lawyer said that his client would not accept the plea offer. Source: Bloomberg Business of Law