A former Wall Street investment banker from Long Island has been sentenced after being convicted of insider trading for a second time after illegally tipping his father off to healthcare industry mergers.
North Merrick resident Sean Stewart, 38, a former senior investment banker at two New York-based investment banks was sentenced to 24 months in prison following his conviction after a seven-day trial for illegally providing tips to his father, Robert Stewart, with non-public information.
In addition to his prison term, Stewart was sentenced to three years of supervised release. He's due to report to prison on Jan. 14 next year. Stewart's father was sentenced a year of home confinement.
Stewart was found guilty of providing his father with non-public information concerning five separate corporate acquisitions before they were announced, U.S. Attorney Geoffrey Berman said.
Stewart, who worked at JPMorgan Chase and Co and Perella Weinberg Partners, used his position as the Vice President of the Healthcare Investment Banking Group to leak information regarding confidential negotiations prior to multiple corporate acquisitions.
Berman said that Stewart would provide the information to his father, who would then invest in the companies along with co-conspirators using the inside information. In total, the Stewarts earned more than $1.1 million in profits.
“From 2011 through 2014, Sean Stewart used his position of trust at two different investment banks to steal confidential information and pass it on to his father so he could make illicit profits in the stock market,” he stated.
“As two separate juries have now found, Sean Stewart abused his positions at two investment banks, betrayed his employers by stealing his clients’ valuable secrets, and gave his father inside information to illegally profit in the stock market," Berman said. "To cover his tracks, Sean Stewart committed numerous acts of deception, including lying to bank compliance officials about his father’s trading activities in response to an inquiry from a financial regulator. (This) sentence, which requires Sean Stewart to return to prison for his insider trading crimes, is a reminder that no one is above the law and that serious breaches of trust and confidence like Sean Stewart’s will be met with serious punishment.”
Stewart was convicted of conspiracy to commit securities fraud and tender offer fraud, conspiracy to commit wire fraud, six counts of substantive securities fraud and one count of substantive tender offer fraud.
Berman noted that Robert Stewart pleaded guilty in August 2015 to one count of conspiracy to commit securities fraud and tender offer fraud and was sentenced to four years probation, with the first year served in home confinement. He was also ordered to forfeit $900,000.
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