Jan 29 A Chicago-based accountant was indicted for allegedly trading ahead of an earnings announcement from his then employer, Allscripts Healthcare Solutions, Inc, U.S. federal prosecutors said on Wednesday.
Accountant Steven Dombrowski purchased put options and engaged in short sales of stock based on inside information about Allscripts' financial results for the first quarter of 2012, the U.S. Attorney's office in Chicago said.
Dombrowski, who was employed as audit director at Allscripts, which provides information technology services to the healthcare industry, allegedly earned $286,211 from those trades.
He now also faces charges from the Securities and Exchange Commission.
It was unclear when Dombrowski left Allscripts and the company said it did not discuss former employees. A lawyer for Dombrowski did not immediately respond to a request for comment.
According to the charges, Dombrowski, and the employees he supervised, audited and tested how Allscripts calculated and reported its financial performance.
In April 2012, he allegedly learnt that Allscripts was going to announce worse-than-expected first quarter results.
He then sold short 1,000 shares of Allscripts' stock and purchased some 510 put option contracts that would only be profitable if the company's stock price dropped, the SEC said.
"As alleged in our complaint, Dombrowski attempted to profit off his company's poor financial results and hide his breach of duty to his employer by conducting his illegal trading through his wife's account," Timothy Warren, associate director of the SEC's Chicago office, said in a statement.
"His efforts have landed him in court," he said.