SEC probes dwarf-tossing party for Fidelity trader

What would top brokers give to please traders from the world's largest fund manager? Lavish yachts, attractive female company and a dwarf to toss.

US regulators probing "inappropriate gifts" given to dealers at the financial giant Fidelity Investments have unearthed evidence of an astonishing party.

The March 2003 bachelor weekend for Thomas Bruderman Jnr, a star Fidelity trader, was paid for by three Wall Street firms - Jefferies & Co, Lazard and SG Cowan. A $65,000 (£36,000) private jet was laid on to take Mr Bruderman and his guests, who included Fidelity's then head of stock trading, Scott DeSano, and Dennis Kozlowski, the former head of Tyco International, from Boston to Miami. They were put up at the Delano Hotel, beloved of celebrities such as Madonna, and taken out on a yacht, along with at least two women who were hired to attend.

Another person hired was Danny Black, who describes himself as the "Heidi Fleiss of dwarf talent". His official role was as a waiter, but he also allowed himself to be thrown by partygoers in an activity called "dwarf tossing". Mr Black said that it "was a lavish party and a good time was had by all".

However, the US Securities & Exchange Commission is now investigating whether its rules - thatgifts from a broker to traders must not exceed $100 in value - were broken.

An internal investigation at Fidelity found that at least 16 of its employees had broken the company's rules on accepting freebies.

Mr Bruderman has left the firm and Mr DeSano has been moved to another unit at Fidelity, which focuses on strategic business development.

Both Fidelity and Mr DeSano received "Wells notices" from the SEC investigators last week, saying they were recommending that legal action be taken against them.