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Grimy Times Exclusive: Insider Trading Scheme Unraveled
Steven McClatchey, a 58-year-old investment bank director, has been sentenced to five months in prison for his role in a brazen insider trading scheme. McClatchey, who worked at an investment bank in Manhattan, used his position to tip a close friend, Gary Pusey, about impending mergers and acquisitions.
According to court documents, McClatchey and Pusey participated in a scheme to commit insider trading in advance of and in connection with more than 10 separate mergers and acquisitions from February 2014 to September 2015. McClatchey learned about the deals as part of his employment with the investment bank and tipped Pusey so that he could use the information to trade.
Pusey used the inside information to make profitable trades in several securities, including Forest Oil Corporation, Questcor Pharmaceuticals, Inc., and Zygo Corporation. He reaped approximately $76,000 in ill-gotten gains from the scheme.
McClatchey was sentenced to two years of supervised release and ordered to forfeit $76,000 and pay a fine of $10,000. The case was brought in connection with the President’s Financial Fraud Enforcement Task Force.
U.S. Attorney Preet Bharara praised the work of the Federal Bureau of Investigation and thanked the U.S. Securities Exchange Commission for its assistance. The task force has made great strides in facilitating increased investigation and prosecution of financial crimes and enhancing coordination and cooperation among federal, state and local authorities.
The Securities and Commodities Fraud Task Force, handled by the Office’s Securities and Commodities Fraud Task Force, is responsible for the prosecution. Assistant U.S. Attorney Rebecca Mermelstein is in charge of the case.
McClatchey’s sentencing marks a significant victory in the fight against financial crimes. As Grimy Times continues to expose the darkest corners of the financial world, we will keep pushing for justice and accountability.
Key Facts
- State: New York
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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