January 11th, 2017
New York - Steven McClatchey, a director at an investment bank in Manhattan (the “Investment Bankâ€), was sentenced today to five months in prison on securities fraud and wire fraud charges in connection with his provision of inside information used to trade in the stock of several companies. McClatchey plead guilty on July 12, 2016, and was sentenced today by United States District Judge Katherine Polk Failla.
According to the Complaint, Information, and statements made during court proceedings:
From in or about February 2014 through in or about September 2015, McClatchey and Gary Pusey participated in a scheme to commit insider trading in advance of and in connection with more than 10 separate mergers and acquisitions. McClatchey and Pusey were close friends who owned boats docked in a Long Island marina and who spent most Saturdays on their boats, at the marina, or playing pool and watching sports in McClatchey’s garage.
McClatchey learned about the deals as part of his employment with the Investment Bank, which generally advised either (i) the company to be acquired in the transaction; (ii) the acquiring company; or (iii) a company that ultimately lost a bid to acquire the company involved in the transaction.
Having learned the inside information about these impending transactions, McClatchey, in breach of fiduciary duties and other duties of trust and confidence owed to the Investment Bank and its clients, tipped Pusey so that Pusey could use the information to trade and with the expectation that Pusey would confer a benefit upon McClatchey. Among the benefits that McClatchey received as part of the insider trading scheme were thousands of dollars of cash payments by Pusey and the provision of home renovation services.
Pusey used the Inside Information that he received from McClatchey to make profitable trades in, among other securities: Forest Oil Corporation, Questcor Pharmaceuticals, Inc., Zygo Corporation, Pepco Holdings, Inc., Measurement Specialties, Inc., Entropic Communications, Inc., PetSmart, Inc., Emulex Corporation, Omnicare, Inc., and TECO Energy, Inc. Pusey reaped approximately $76,000 in ill-gotten gains from this scheme. back...
According to the Complaint, Information, and statements made during court proceedings:
From in or about February 2014 through in or about September 2015, McClatchey and Gary Pusey participated in a scheme to commit insider trading in advance of and in connection with more than 10 separate mergers and acquisitions. McClatchey and Pusey were close friends who owned boats docked in a Long Island marina and who spent most Saturdays on their boats, at the marina, or playing pool and watching sports in McClatchey’s garage.
McClatchey learned about the deals as part of his employment with the Investment Bank, which generally advised either (i) the company to be acquired in the transaction; (ii) the acquiring company; or (iii) a company that ultimately lost a bid to acquire the company involved in the transaction.
Having learned the inside information about these impending transactions, McClatchey, in breach of fiduciary duties and other duties of trust and confidence owed to the Investment Bank and its clients, tipped Pusey so that Pusey could use the information to trade and with the expectation that Pusey would confer a benefit upon McClatchey. Among the benefits that McClatchey received as part of the insider trading scheme were thousands of dollars of cash payments by Pusey and the provision of home renovation services.
Pusey used the Inside Information that he received from McClatchey to make profitable trades in, among other securities: Forest Oil Corporation, Questcor Pharmaceuticals, Inc., Zygo Corporation, Pepco Holdings, Inc., Measurement Specialties, Inc., Entropic Communications, Inc., PetSmart, Inc., Emulex Corporation, Omnicare, Inc., and TECO Energy, Inc. Pusey reaped approximately $76,000 in ill-gotten gains from this scheme. back...
