Monday, March 20, 2023
A former conflicts counsel at Cozen O'Connor has accepted a one-year suspension from the Pennsylvania Supreme Court.
As part of his employment role, Respondent learned confidential information about a proposed merger and purchased stock based on that information.
Respondent then sold the stock for a $10,000 profit.
The sales led to an inquiry from FINRA and the Securities & Exchange Commission and an administrative settlement with the SEC.
The settlement involved a penalty payment of over $20,000 to the SEC.
The SEC findings are linked here.
Further from the SEC on the civil settlement
The Securities and Exchange Commission today announced settled charges against William E. Gericke, an attorney formerly employed by a large international law firm, for improperly trading on confidential information that he learned in connection with running a conflicts check.
According to the SEC's order, on or before October 7, 2019, Gericke, in his capacity as conflicts counsel, ran a "confidential" conflicts check related to a potential merger involving the firm's client, Liberty Property Trust (NYSE: LPT). Gericke understood that the information about the potential merger was confidential, but the next day, he purchased 1,000 shares of LPT. After the merger was announced, LPT's stock price increased 13.7%, and Gericke subsequently sold his shares for a profit of $10,002.
The order charges Gericke with violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and finds that Gericke engaged in conduct within the meaning of Section 4C(a)(3) of the Exchange Act and Rule 102(e)(1)(iii) of the Commission's Rules of Practice. Gericke consented, on a neither admit nor deny basis, to pay a penalty in the amount of $20,004 and to the entry of a cease-and-desist order. Gericke also agreed to the entry of an order permanently denying him the privilege of appearing and practicing before the SEC as an attorney, which prohibits Gericke from representing clients in SEC matters, including investigations, litigation, or examinations, and from advising clients about SEC filing obligations or content.