Up to 70 percent of day traders losing money

WASHINGTON -- Day-trading firms mislead their investor-customers with promises of quick riches, fail to supervise their operations and make improper loans to customers to keep them trading, according to a report released today by state securities regulators.

A related analysis found that 70 percent of customers at one major day-trading firm lost money.

The report by the North American Securities Administrators Association resulted from a 7-month investigation of the growing day-trading industry. It comes 11 days after Mark O. Barton shot and killed nine people at two day-trading firms in Atlanta where he had traded and lost thousands of dollars.

"If day-trading firms want to become part of the mainstream, they need to play by the same rules the rest of Wall Street follows," said Peter Hildreth, president of the association, which represents securities regulators in the 50 states, Canada and Mexico.

"If they don't get their act together they will be under increasing regulatory pressure," said Hildreth, who also is New Hampshire's director of securities regulation.

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