Trading on inside information can be profitable, might be illegal, and if it is illegal, it is costly.
The SEC has announced charges against a father, son, and friend in Northern California with insider trading in advance of a merger of health care companies based on confidential information the father learned from a close friend working at one of the companies.
The SEC alleges that John McEnery III breached a duty of trust and confidence owed to his friend when he traded and tipped others to trade in the stock of Clarient Inc. upon learning about its impending acquisition by GE Healthcare. McEnery tipped his son John McEnery IV as well as Michael Rawitser, a longtime friend of McEnery III.
Following the public announcement of the acquisition, Clarient’s stock price rose by 33 percent and the trio profited by a total of more than $50,000.
The McEnerys and Rawitser agreed to pay approximately $170,000 combined to settle the charges, more than triple the amount of their alleged profits.
When you are accused of securities fraud, the penalties can be severe, and could include criminal charges. Make sure that you have experienced counsel - Call Sallah Astarita & Cox - 212-509-6544
SEC Charges Father and Son and Friend With Insider Trading
