Former Euro Pacific Capital, Inc. broker Thomas Charles Conradt pleaded guilty to two felony counts of manipulative and deceptive devices (known as securities fraud) and one count of conspiracy to commit securities fraud in U.S. District Court. The SEC additionally initiated a civil court action in November 2012.
BrokerCheck: Thomas C. Conradt
According to court documents, Conradt received inside tips in 2009 about the International Business Machines Corp. ("IBM") from a roommate, financial analyst Trent Martin. At the time, IBM had been working on a $1.2 billion takeover of software company SPSS, a move that was secret and unknown to the public.
Martin, Conradt and fellow broker David J. Weishaus were accused of buying SPSS positions including common stock and call options based on this inside, private and privileged information. The SEC cites as evidence of the trio's heavy reliance on SPSS that Condradt and those tipped off by his illegal disclosure held investments accounting for between 76 percent and 100 percent of their various brokerage accounts.
Martin has pleaded not guilty to the charges.
Criminally charged with providing this information to Weishaus, the SEC additionally accused Conradt of warning Weishaus to "keep this in the family," to which Weishaus affirmatively responded, "I don't want to go to jail."
The SEC also accused Conradt of bragging that he was "making (sic) everyone rich" by promoting the insider trading scheme. The Commission stated Conradt was aware of the illegal nature of his actions, as evidenced by a 2009 conversation in which Conradt discussed other people who had been prosecuted for their parts in insider trading schemes.
According to prosecutors, the profit reaped as a result of the insider trading scandal surpassed $1 million.
In pleading guilty to the felony counts, Condradt stated, "I understood this information was inside information and that it was not publicly available."
If you have invested with Trent Martin, Thomas Charles Conradt, David J. Weishaus, employing firm Euro Pacific Capital or with any broker whose use of inside or privileged information has been financially detrimental to your interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.
News: Former Stockbroker Pleads Guilty in IBM-SPSS Tipping Case (Bloomberg)