SEC Wins Jury Trial Against Broker Charged with Insider Trading
Litigation Release No. 24564 / August 15, 2019
Securities and Exchange Commission v. Thomas W. Avent, Jr., et a, , 1:16-cv-02459-WMR (N.D. Ga.)
Yesterday, jurors in Atlanta federal court returned a verdict finding New Jersey securities broker Raymond J. Pirrello, Jr., liable for insider trading in advance of three merger and acquisition transactions.
The SEC's evidence at trial showed that Pirrello received highly confidential nonpublic information about the impending acquisitions of Radiant Systems, Inc., Midas, Inc., and BrightPoint, Inc. from Thomas W. Avent, Jr., who performed tax work on each transaction as a partner at an international accounting firm. Pirrello, in turn, tipped his former colleague and long-time friend Lawrence J. Penna, Jr., who traded in the securities of each of the three companies. According to evidence presented during the trial, Penna and his family made at least $107,922 in illicit trading profits, and shared at least $21,500 of these profits with Pirrello.
The jury found Pirrello liable on all counts, finding that he violated the antifraud provisions of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934, and Rules 10b-5 and 14e-3 thereunder.
Avent and Penna each previously settled insider trading charges brought against them.
The SEC's litigation is being conducted by John E. Birkenheier, Robert M. Moye and Ruta G. Dudenas of the Chicago Regional Office, and Pat Huddleston of the Atlanta Regional Office. The investigation that led to the SEC's action was conducted by Ms. Dudenas, Mr. Moye, Amy S. Cotter, and Rebecca Hollenbeck.