(Reuters) - U.S. prosecutors on Monday moved to dismiss their criminal fraud case accusing former trader Jesse Litvak of lying to customers about bond prices, after two convictions of the former Jefferies managing director were overturned on appeal.

Former Jefferies Group bond trader Jesse Litvak walks away from U.S. District Court after his sentencing for defrauding customers on bond prices in New Haven, Connecticut, U.S., April 26, 2017. REUTERS/Michelle McLoughlin

In a motion filed with the federal court in New Haven, Connecticut, U.S. Attorney John Durham said, “the interests of justice would not be served by a third trial” of Litvak, given the “totality of the circumstances unique to this case.”

Both convictions resulted in two-year prison terms for Litvak, 43, a married father of two. He had been serving his sentence when the federal appeals court in Manhattan voided his second conviction on May 3 and ordered him freed.

Kannon Shanmugam, a lawyer who handled Litvak’s appeals, declined to comment.

The dismissal request is a defeat for the government, which has failed to sustain any convictions in its 5-1/2-year crackdown on suspicious sales tactics on Wall Street, which began in January 2013 when Litvak was charged.

Prosecutors accused Litvak of lying to customers including AllianceBernstein, Invesco and Soros Fund Management, causing them to overpay for bonds they bought and accept lower prices for bonds they sold.

They said Litvak did this to generate $2.25 million of extra profit for Jefferies, now part of Jefferies Financial Group Inc JEF.N, and to boost his own pay.

Defense lawyers argued that Litvak’s customers were sophisticated and would have known if he lied.

The defendant was found guilty in March 2014 on 10 securities fraud counts and other charges, but the appeals court overturned that verdict in December 2015, saying the trial judge wrongly excluded expert testimony for the defense.

Litvak was convicted on a single fraud count at a January 2017 retrial. The appeals court found that verdict tainted by the admission of irrelevant evidence.

At least five people have been tried in the government’s probe.

Two were acquitted, Litvak and former Nomura Holdings Inc 8604.T trader Michael Gramins had their convictions set aside, and former Nomura trader Ross Shapiro was acquitted on all but one count, where jurors deadlocked.

The cases against Gramins and Shapiro remain pending.

Jefferies in 2014 agreed to pay $25 million to resolve U.S. criminal and civil probes into how it supervised Litvak and other traders.

The case is U.S. v. Litvak, U.S. District Court, District of Connecticut, No. 13-cr-00019.