SEC Charges Former Stericycle Financial Analyst and His Mother with Insider Trading
Litigation Release No. 24212 / July 24, 2018
On July 24, 2018, the Securities and Exchange Commission charged Matthew Brunstrum, formerly a financial analyst at Stericycle, Inc., with insider trading and with tipping his mother, who was also charged with insider trading.
The SEC's complaint, filed in federal court in Chicago, alleges that in April 2016, Matthew Brunstrum learned through his job that Stericycle's first quarter 2016 financial results would be much worse than had been expected and used this material non-public information to trade in Stericycle securities in advance of the company's upcoming April 28, 2016 earnings announcement. The complaint also alleges that Matthew Brunstrum disclosed Stericycle's earnings information to his mother who traded on that information. Stericycle's stock fell by $26.18 the day after Stericycle announced its first quarter financial results, losing almost 22 percent of its value. The SEC's complaint alleges that as a result of their illegal trading, Matthew Brunstrum avoided losses and earned profits in the amount of $159,904, and Susan Brunstrum avoided losses and earned profits in the amount of $170,252.
The complaint charges Matthew Brunstrum and Susan Brunstrum with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. Without admitting or denying the allegations, the defendants each agreed to be permanently enjoined from future violations of anti-fraud provisions of the securities laws and agreed to pay disgorgement equal to each of their ill-gotten gains plus prejudgment interest. The court will determine the civil penalty amounts. The settlements are subject to court approval.
The SEC's investigation, which is continuing, was conducted by Kristopher Heston, Jake Schmidt and Ann Tushaus and was supervised by Amy Cotter, all of the Chicago Regional Office. The SEC's litigation will be led by Doressia Hutton and Mr. Heston. The Commission appreciates the assistance of the U.S. Attorney's Office for the Northern District of Illinois and the Federal Bureau of Investigation, Chicago Office.