SEC charges Former Bank Executive and Friend With Insider Trading 

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The Securities and Exchange Commission (SEC) has charged a former bank executive in Massachusetts and his friend with insider trading in advance of the bank’s acquisition of another financial institution.

The SEC alleges that Patrick O’Neill, then a senior vice president at Eastern Bank, learned through his job responsibilities that his employer was planning to acquire Wainwright Bank & Trust Company.

In the two weeks preceding a public announcement about the planned acquisition, Bray sold his shares in other stocks to accumulate funds he used to purchase Wainwright securities.  Bray had never previously purchased Wainwright stock.

After the public announcement of the acquisition caused Wainwright’s stock price to increase nearly 100 percent, Bray sold all of his shares during the next few months for nearly $300,000 in illicit profits.

n a parallel action, the U.S. Attorney’s Office for the District of Massachusetts today announced criminal charges against O’Neill.

The SEC’s complaint charges O’Neill, who lives in Belmont, Mass., and Bray, who lives in Cambridge, Mass., with violating the antifraud provisions of the federal securities laws and the SEC’s antifraud rule.

 

Source: SEC

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