Steven Metro Sentenced to 46 Months in Prison for Insider Trading Scheme
On September 14, 2016 Steven Metro, a former Simpson Thacher & Bartlett employee, was sentenced to 46 months in federal prison. Metro previously pleaded guilty to criminal charges arising from his role in a long running insider trading scheme that involved trading in advance of more than a dozen pending corporate transactions. As part of this scheme, Metro provided material, nonpublic information relating to these transactions to a friend, Frank Tamayo, via napkins or post-it notes at Grand Central Terminal. Tamayo then passed the information to his stockbroker, Vladimir Eydelman. The illegal trading resulted in approximately $5.6 million in profits.Both Tamanyo and Eydelman previously entered into settlements with the SEC in connection with this scheme. The SEC’s complaint alleged that after receiving the tips from Metro, Tamayo typically met Eydelman near the clock at the information booth at Grand Central Terminal, and then chewed up or ate the post-it notes or napkins after using them to show Eydelman the ticker symbol of the company that would be acquired. The SEC alleged that Eydelman then returned to his office and typically gathered research about the target company, which he then emailed to Tamayo to create a false paper trail with a justification for the trading. Eydelman then allegedly traded for himself, Tamayo, and other customers. Tamayo allegedly allocated a portion of his profits for eventual payment back to Metro in exchange for the inside information, and Metro also traded personally in advance of at least two deals.
Tamayo and Eydelman each pleaded guilty to their roles in connection with the scheme in September 2014 and September 2015, respectively. Tamayo and Eydelman have not yet been sentenced.
The SEC’s litigation against Metro is ongoing. The SEC’s complaint seeks disgorgement of ill-gotten gains plus prejudgment interest, financial penalties, and an anti-fraud injunction.
For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected]ecuritieslawyer101.com or visit www.securitieslawyer101.com. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.
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