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NEW YORK A former Wall Street investment banker
was sentenced to three years in prison on Friday after he was
convicted of engaging in insider trading by repeatedly tipping
his father off to unannounced healthcare mergers.
Sean Stewart, who previously worked at Perella Weinberg
Partners and JPMorgan Chase & Co, was sentenced by U.S.
District Judge Laura Taylor Swain in Manhattan.
The judge also ordered Stewart to serve a year of home
detention following his release from prison.
Prosecutors had sought up to 6-1/2 years in prison for
Stewart, a Yale University graduate, over what they called a
brazen, multiyear scheme to help his father, Robert Stewart,
profitably trade ahead of deals being worked on at the
Defense lawyers countered that six months of home detention
would be punishment enough for Stewart, 35, following the loss
of his financial career.
Stewart has denied wrongdoing and is expected to appeal his
Jurors had found him guilty last August of securities fraud
and other charges, making one of 85 people to be convicted in a
wave of insider trading cases by Manhattan U.S. Attorney Preet
Bharara’s office since 2009.
Prosecutors said that from 2011 to 2014, Stewart tipped his
father about five mergers, including INC Research LLC’s acquisition of Kendle International Inc.
Robert Stewart, a Long Island accountant, in some instances
arranged for a friend, Richard Cunniffe, to conduct trades in
his own accounts because of concern he was too close to the
source, prosecutors said.
The trading enabled the elder Stewart and Cunniffe to make
$1.16 million, prosecutors said.
At trial, Sean Stewart’s lawyers acknowledged he spoke with
his father about companies involved in mergers.
But they said he did so while discussing his work, and that
Robert Stewart betrayed his son by trading on the information.
Robert Stewart was sentenced in May 2016 to a year of home
detention after pleading guilty in August 2015.
Cunniffe pleaded guilty in May 2015 and became a cooperating
government witness. He is scheduled to be sentenced in July.
The case is U.S. v. Stewart, U.S. District Court, Southern
District of New York, No. 15-cr-00287.
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