- Ex-Perella Weinberg banker charged with passing tips to dad
- Richard Cunniffe testifies against son of former friend
The government’s star witness in the insider-trading trial of Sean Stewart told jurors that he wore a wire to a lunch meeting with the father of the former Perella Weinberg Partners investment banker in hopes of gathering incriminating evidence.
Richard Cunniffe met with FBI agents near Manhattan’s Pennsylvania Station on March 24, 2015. The agents gave him $2,500 to be turned over to Stewart’s father, Bob Stewart, and fitted him with equipment to record the meeting. Jurors listened Tuesday to a recording of 7 1/2 minutes of the hour-long conversation between the two men in Andrew’s Coffee Shop.
Cunniffe told jurors he had agreed to cooperate with government investigators after being confronted by two Federal Bureau of Investigation agents in the Bayside, New York, apartment he shared with his wife. The agents showed him evidence he had used illegal inside information to trade in health-care stocks.
“I knew what I did was wrong and I knew that I was in serious trouble,” said Cunniffe, who turned 62 on Monday.
Cunniffe, who agreed to secretly incriminate his friend and his friend’s son in hopes of avoiding prison, admitted he had met Sean Stewart only once, for no more than five minutes, and had never discussed stocks with him.
Prosecutors claim the younger Stewart passed tips on five health-care industry mergers to his father who in turn passed most of them to Cunniffe. They claim comments that Bob Stewart made to Cunniffe prove that Sean knowingly passed inside information and knew his father would trade on it.
Prosecutors played a statement by Bob Stewart allegedly showing that his son intended for his father to profit from the tips.
“I handed you this on a silver platter and you didn’t invest in this,” Bob said on the recording, recalling his son’s remarks, amid the clatter of silverware and conversations at other tables.
Cunniffe testified he became friends with Bob Stewart at Titan Development Properties, a property development company. The two men have admitted trading on information that Bob learned from Sean, who worked at JPMorgan Chase & Co. before joining Perella Weinberg. Cunniffe said he tried to avoid learning specific information about the source of Bob’s tips and mistakenly believed for a time that they came from Bob Stewart’s other son, who also works on Wall Street. Cunniffe said he met Sean Stewart once at Titan’s offices. The two men exchanged small talk for five minutes at most.
No Stock Talk
“No way did I want to have any conversation with Sean about stocks,” Cunniffe said.
Sean Stewart says he never met Cunniffe and that he had no idea his father and others were trading on information that Bob Stewart picked up in conversation.
Cunniffe and Bob Stewart have both pleaded guilty. Cunniffe awaits sentencing. Bob Stewart was sentenced to probation.
Sean tried to force his father to testify as a defense witness, but Bob refused, invoking his Fifth Amendment right not to incriminate himself. Sean’s lawyers on Tuesday asked U.S. District Judge Laura Taylor Swain, who’s overseeing the trial, to order the government to grant him immunity so he can testify without fear of prosecution. Swain denied the request.
Bob Stewart’s testimony would help prove Sean didn’t know his father was trading on information from his job, according to his legal team.
Cunniffe has spent parts of two days on the witness stand. He’s expected to conclude his testimony Wednesday.
The case is U.S. v. Stewart, 15-cr-00287, U.S. District Court, Southern District of New York (Manhattan).