New York Securities Lawyer Blog
On July 22, 2014, the Securities and Exchange Commission (“SEC”) charged Kevin McGrath (“McGrath”), a partner and account executive at Cameron Associates (“Cameron”), an investor relations firm in New York City, with insider trading on confidential nonpublic information he learned about two Cameron clients for whom McGrath was performing work. The two companies McGrath allegedly traded on nonpublic information regarding were Misonix, Inc. (“Misonix”) and Clean Diesel Technologies, Inc. (“Clean Diesel”).
According to the SEC Complaint, on May 8, 2009, McGrath sold all of his shares of Misonix immediately after he received and edited a draft of a Misonix press release that was to announce disappointing quarterly financial results. Further, the SEC alleges that in May 2011, McGrath provided comments to a press release for Clean Diesel, which was to announce that Clean Diesel had received nearly $2,000,000 in orders for certain products. It further alleges that after McGrath learned that the press release was going to be issued, he purchased 1,000 shares of Clean Diesel and sold in two days later for a $6,376 profit.
McGrath agreed to settle the SEC charges by paying disgorgement of $11,776, prejudgment interest of $1,492, and a penalty of $11,776, for a total of $25,044. The settlement also includes a “conduct-based injunction” that permanently requires McGrath to abstain from trading in stock of any issuer for which he or his firm has performed any investor relations services within a one-year period. The purpose of the conduct-based injunction is to ensure McGrath does not commit the same transgressions in the future.
If you are being charged with insider trading, please contact our team of attorneys for a consultation at (212) 696-1999.