NEW YORK, Dec 28 (Reuters) - A Florida man pleaded guilty on Thursday to charges he illegally traded on inside information supplied by a friend working at a law firm in a scheme that prosecutors said allowed them to earn nearly $1 million.
Andrew Berke, 49, entered his plea in Manhattan federal court to conspiracy and securities fraud charges, admitting he placed trades based on information provided to him by a then-partner at the law firm Foley & Lardner.
The plea came after the ex-Foley partner, Walter “Chet” Little, pleaded guilty in November to conspiring to commit securities fraud. Little left Foley in 2016 and joined Bradley Arant Boult Cummings. He is no longer with that law firm.
Berke in court said that he regretted his actions. He is scheduled to be sentenced on April 7.
Prosecutors said that beginning in 2015, Little used Foley’s document management system to access information about at least seven law firm clients including Magnetek Inc, which was in the midst of merger talks with Columbus McKinnon Corp.
They said that after learning about upcoming mergers, earnings and other events involving those companies, Little bought and sold stock and options ahead of public announcements, making more than $320,000 in profit.
Little also passed the inside information to his friend Berke, who according to prosecutors earned around $660,000 placing trades before the companies’ news became public.
According to a related lawsuit by the U.S. Securities and Exchange Commission, Berke was an executive at a logistics company who since 2013 has been Little’s neighbor in Apollo Beach, Florida. Both men were arrested in May.
The case is U.S. v. Little, et al, U.S. District Court, Southern District of New York, No. 17-cr-450. (Reporting by Nate Raymond in New York; Editing by Phil Berlowitz)