LITIGATION RELEASE NO. 17778 / October 8, 2002

UNITED STATES v. MICHAEL A. ROBLES, S1 00 1169 (RMB).

Securities and Exchange Commission v. Richard A. Svoboda and Michael A. Robles, 00 Civ. No. 8557 (MBM) (Southern District of New York) (filed November 7, 2000)

JURY FINDS CERTIFIED PUBLIC ACCOUNTANT GUILTY OF INSIDER TRADING

On October 3, 2002, after a three-week trial, a federal jury in the United States District Court for the Southern District of New York found Michael A. Robles, a certified public accountant based in Dallas, Texas, guilty on charges of participating in a massive insider-trading scheme that yielded illegal profits of more than $1.3 million in 31 different stocks. According to the evidence at trial, from 1995 through 1997, Robles received inside information from his long-time friend Richard A. Svoboda, who was employed as a credit policy officer at NationsBank, N.A. In violation of NationsBank's policies, Svoboda misappropriated confidential information about yet-to-be-announced tender offers and financial results involving NationsBank's clients, and disclosed it to Robles, who traded in advance of the public announcements of tender offers or financial results. Robles was convicted of one count of conspiracy, 9 counts of securities fraud and 4 counts of tender offer fraud. In February 2002, Svoboda pled guilty to conspiracy, securities fraud, and tender offer fraud charges.

The Commission's civil action against Robles and Svoboda, filed at the same time a grand jury in the Southern District of New York indicted them, was stayed pending the outcome of the criminal trial. Once the stay is lifted, the Commission intends to pursue its claims against Robles and Svoboda, for engaging in illegal insider trading in violation of Section 17(a) of the Securities Act of 1933, Sections 10(b) and 14(e) of the Securities Exchange Act of 1934, and Rules 10b-5 and 14e-3 thereunder, and to seek injunctive relief, disgorgement, and civil monetary penalties.

For further information, see Litigation Release No. 16791 (November 7, 2000)