Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Wednesday, June 4, 2008

Attorney Settles Insider Trading Charges Involving NSD Bancorp

The SEC filed a complaint in the United States District Court for the Southern District of New York against Jeffrey P. Myers, an attorney, alleging that he engaged in unlawful insider trading. Myers unlawfully purchased 1,000 shares of the common stock of NSD Bancorp, Inc. (NSD Bancorp) in advance of an October 15, 2004, public announcement of a merger between NSD Bancorp and F.N.B. Corporation (FNB) and after being tipped about the merger by a member of NSD Bancorp's Board of Directors (the Insider). Myers sold all 1,000 shares of his stock after the merger announcement for a profit of $10,939.

The SEC further alleges that Myers knew the Insider was a member of NSD Bancorp's Board of Directors. Because of his position as a Director, by September 15, 2004, the Insider knew that at least four companies had submitted indications of interest in acquiring NSD Bancorp and that FNB had specifically offered $40 per share. The complaint further alleges that on September 16, 2004, Myers and the Insider, who were engaged in several joint business ventures unrelated to NSD Bancorp, met to discuss their business. During this meeting, the Insider provided Myers with material, nonpublic information concerning NSD Bancorp's merger negotiations. Simultaneously with the filing of the complaint, and without admitting or denying the Commission's allegations, Myers consented to the entry of a final judgment, subject to the Court's approval: permanently enjoining him from future violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder; and ordering Myers to pay disgorgement of his trading profits, plus prejudgment interest thereon, totaling $13,705, and a one-time civil penalty of $10,939.

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