Florida Man Admits Insider Trading for Passing Gilead Tip
Stock Chart for Gilead Sciences Inc (GILD)
Dowd, 37, who worked at a brokerage in Aventura, Florida, learned that a Pharmasset director told his supervisors about the deal, which was announced on Nov. 21, 2011, according to court papers filed with his guilty plea today in federal court in Trenton, New Jersey.
Dowd was told not to act on the information yet tipped a childhood friend, identified as E.F., who made an illicit profit of $163,621 on Pharmasset shares, according to court papers. E.F. tipped another friend, E.B., who made $544,706 after buying Pharmasset call options, according to U.S. Attorney Paul Fishman. In exchange for the tip, Dowd got $35,000, he admitted.
He pleaded guilty to conspiracy to commit securities fraud and faces as long as five years in prison when he’s sentenced Jan. 15. The U.S. Securities and Exchange Commission sued Dowd in January after his arrest by the Federal Bureau of Investigation.
The number of people sued by the SEC or charged with insider trading by the Justice Department has more than doubled since 2008, according to data compiled by Bloomberg. There were 56 in 2008, 96 in 2009, 67 in 2010, 104 in 2011 and 125 in 2012. Of those, 22 percent were linked to trading involving health-care stocks.
Dowd’s attorney, Peter Willis, didn’t immediately return a call seeking comment.
The criminal case is U.S. v. Dowd, U.S. District Court, District of New Jersey (Trenton).
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