Aug. 1 (Bloomberg) -- Former Evercore Group LLC investment banker Frank Perkins Hixon Jr., who said he engaged in insider trading to support the child of his extramarital affair, was sentenced to 2 1/2 years in prison after his wife pleaded with the judge for leniency.
Prosecutors in the office of Manhattan U.S. Attorney Preet Bharara had sought more than four years. Hixon, 55, who until January was a managing director at Evercore, was charged with eight counts including securities fraud and lying to agents of the Federal Bureau of Investigation. His trades reaped more than $700,000 in illegal profits.
At his sentencing today in Manhattan federal court, Hixon’s wife Marguerite Lammot Lee said his trading was intended to ensure that he remained in contact with his daughter, and wasn’t motivated by greed, or to conceal the child from her.
“Isolation from us now set the process back, and imposes a further burden on us who’ve suffered most here,” Lee said. “We’ve achieved so much, but there is still, there is still so much to do,” she added. “I respectfully ask that in your decision, you allow him and you allow us to continue that process.”
Hixon, whose voice broke with emotion during a 20 minute statement to the judge, apologized for his crimes. He said he’d done trading in the brokerage account of the child’s mother, Destiny Robinson, as a way of giving her money after she began to reject his child support checks in late 2011.
Hixon said he traded on information from pending deals as a way of maintaining a connection with Robinson, fearing she’d bar him from seeing his young daughter.
“We talked about the markets, and we talked about stocks and companies and things like that, it was one of the ways we had always connected,” Hixon said. “In my desperation and not knowing what to do, I did the wrong thing. I did a stupid thing.”
“My actions cost me my job--more than my job, my career. It was my life,” he said.
U.S. District Court Judge Ronnie Abrams said she had received more than 75 letters from Hixon’s supporters describing his good works and charitable acts.
“But these were flagrant, serious crimes,” she said. “In the defendant’s own words today he emphasizes he didn’t commit crimes for his own financial gain,” she said. “But even if you take Mr. Hixon at his own words, he challenged the system to protect his loved ones and then he lied about it. These are selfish acts.”
Lied to FBI
Abrams said she was also concerned with the lies Hixon told to Evercore, the Financial Industry Regulatory Authority, and the FBI to conceal his insider trading.
She fined Hixon $100,000 and ordered him to forfeit the $710,000 he earned, as well as pay Evercore $1.2 million in restitution.
Hixon, who was also charged with using inside information to trade in his father’s account, admitted using confidential information obtained at work to trade in shares of Evercore, the investment bank founded by ex-U.S. Deputy Treasury Secretary Roger Altman, Westway Group Inc. and Titanium Metals Corp. in a scheme that ran from October 2011 to January 2013. A parallel case filed by the U.S. Securities and Exchange Commission is still pending.
The case is U.S. v. Hixon, 14-cr-00227, U.S. District Court, Southern District of New York (Manhattan).
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