U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20610 / June 4, 2008
Securities and Exchange Commission v. Jeffrey P. Myers, Civil Action No. 08-CV-5109 (S.D.N.Y.)
SEC Files Settled Insider Trading Action Against Jeffrey P. Myers
On June 4, 2008, the Securities and Exchange Commission (Commission) filed a complaint in the United States District Court for the Southern District of New York against Jeffrey P. Myers, an attorney who resides in Cranberry Township, Pennsylvania. The Commission's complaint alleges that he engaged in unlawful insider trading. In particular, Myers unlawfully purchased 1,000 shares of the common stock of NSD Bancorp, Inc. (NSD Bancorp) in advance of an October 15, 2004, public announcement of a merger between NSD Bancorp and F.N.B. Corporation (FNB) and after being tipped about the merger by a member of NSD Bancorp's Board of Directors (the Insider). Following the announcement, NSD Bancorp's share price increased $12.68 or 52 percent, from $24.02 to $36.70. Myers sold all 1,000 shares of his stock between January 2005 and February 2005 for a profit of $10,939.
The Commission's complaint further alleges that Myers knew the Insider was a member of NSD Bancorp's Board of Directors. Because of his position as a Director, by September 15, 2004, the Insider knew that at least four companies had submitted indications of interest in acquiring NSD Bancorp and that FNB had specifically offered $40 per share. The complaint further alleges that on September 16, 2004, Myers and the Insider, who were engaged in several joint business ventures unrelated to NSD Bancorp, met to discuss their business. During this meeting, the Insider provided Myers with material, nonpublic information concerning NSD Bancorp's merger negotiations. On September 17, 2004, Myers, who had no prior history of trading in the securities of NSD Bancorp, purchased 1,000 shares of NSD Bancorp's stock on the basis of the material, nonpublic information provided to him by the Insider. The Insider later died of natural causes. As a result of this conduct, the complaint alleges that Myers violated Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder.
Simultaneously with the filing of the complaint, and without admitting or denying the Commission's allegations, Myers consented to the entry of a final judgment, subject to the Court's approval: permanently enjoining him from future violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder; and ordering Myers to pay disgorgement of his trading profits, plus prejudgment interest thereon, totaling $13,705, and a one-time civil penalty of $10,939.
The Commission acknowledges the assistance of the Financial Industry Regulatory Authority with respect to this matter.