SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 16530 / April 28, 2000
UNITED STATES v. MCDERMOTT ET AL., 00 Cr. 61 (KMW).
Securities and Exchange Commission v. James J. McDermott, Jr., Kathryn B. Gannon a/k/a Marylin Star and Anthony P. Pomponio, Civil Action No. 99 Civ. 12256 (S.D.N.Y.)(MBM)(filed December 21, 1999)
JURY FINDS FORMER CHAIRMAN AND CEO OF INVESTMENT
On April 27, 2000, after a twelve-day trial, a federal jury in the United States District Court for the Southern District of New York found James J. McDermott, Jr., ("McDermott"), the former Chairman and Chief Executive Officer of Keefe, Bruyette & Woods, Inc, an investment banking firm in New York, and Anthony P. Pomponio ("Pomponio"), a New Jersey businessman, guilty on charges of participating in an insider trading scheme with Kathryn B. Gannon, a/k/a "Marilyn Star," a co-defendant in the case and a fugitive believed to be in Canada. McDermott was found guilty on one count of conspiracy and five out of six counts of insider trading. Pomponio was convicted on one count of conspiracy, three out of four counts of insider trading and one count of perjury for providing false testimony to the Securities and Exchange Commission ("Commission").
The Commission's civil action against McDermott, Gannon and Pomponio, filed at the same time as the U.S. Attorney for the Southern District of New York's criminal complaint, was stayed pending the outcome of the criminal trial. Once the stay is lifted, the Commission intends to pursue its claims against McDermott, Gannon and Pomponio, for engaging in illegal insider trading in violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and seek injunctive relief, disgorgement, and civil monetary penalties.
For further information, see Litigation Release No. 16395 (December 21, 1999).http://www.sec.gov/litigation/litreleases/lr16530.htm