Boston, MA-(ENEWSPF)- Two men were charged today in federal court with conspiring to commit insider trading.
PETER E. TALBOT, 42, of East Longmeadow, and CARL E. BINETTE, 29, of Ludlow, were charged in a seven-count indictment with conspiracy and securities fraud. BINETTE was also charged with obstruction of justice.
The Indictment alleges that in April 2008, TALBOT, who was then employed by the Hartford Investment Management Company (HIMCO), determined, through confidential information obtained through the course of his employment, that the insurance company Safeco Corp. was a potential acquisition target of HIMCO’s parent company, the Hartford Financial Services Group, Inc. TALBOT proceeded to tip his nephew, BINETTE, with regard to Safeco’s status as a potential acquisition target, and the two set up an online brokerage account in BINETTE’s name to buy Safeco securities beginning on April 17, 2008. After the acquisition of Safeco was announced on April 23, 2008 by a third insurance company, Liberty Mutual, TALBOT and BINETTE sold off all of the Safeco securities for a profit of approximately $615,833.
The indictment further alleges that in May 2008, during an investigation by the Securities and Exchange Commission (SEC) into BINETTE’s trading activities, BINETTE made several false statements to SEC investigators regarding whether he had spoken to anyone else prior to engaging in trading of Safeco securities. BINETTE persistently denied speaking to anyone before engaging in these trades, even though in fact his trading was based on the tip he received from TALBOT.
If convicted on these charges, TALBOT and BINETTE face up to five years imprisonment and a fine of over $1.2 million for the conspiracy count, and 20 years imprisonment to be followed by three years of supervised release and a fine of $5 million for each count of securities fraud. BINETTE also faces up to 20 years imprisonment for the obstruction of justice count to be followed by three years of supervised release and a fine of up to $250,000.
United States Attorney Carmen M. Ortiz and Richard DesLauriers, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division made the announcement today. The case is being prosecuted by Assistant U.S. Attorney Vassili Thomadakis of Ortiz’s Economic Crimes Unit.
The details contained in the Indictment are allegations. The defendants are presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.