MANHATTAN (CN) – Film producer and former investment manager John Bennett pleaded guilty Monday to making more than $1 million from illegal inside trading, federal prosecutors said.
Bennett, 48, of Norwalk, Conn., pleaded guilty to conspiracy and securities fraud.
Allen got inside information from his co-conspirator Scott Allen, who was a consultant at a human resources consulting firm, the U.S. Attorney’s office said in announcing Bennett’s plea.
“In his role as a principal of the consulting firm, Allen allegedly learned inside information concerning the April 2008 acquisition of Millennium Pharmaceuticals, Inc.
(‘Millennium’), by Takeda Pharmaceutical Company Limited, and the September 2009 acquisition of Sepracor, Inc. (‘Sepracor’), by Dainippon Sumitomo Pharma Co., Ltd. Prior to the public announcements of those acquisitions, Allen disclosed the inside information to Bennett, a longtime friend, who used it to execute securities transactions that earned him over $1.1 million in illegal profits,” prosecutors said in the statement.
“In exchange for providing the inside information, Bennett gave Allen more than
$100,000 in cash payments that he delivered in person over the course of more than 20 occasions between April 2008 and the summer of 2010,” the statement adds.
“Bennett and Allen also attempted to conceal the insider trading scheme from authorities and to avoid detection. For example, in October 2010, when interviewed at his home by FBI agents, Allen falsely claimed that he had not spoken to Bennett in three or four years. In fact, he had met with and spoken to Bennett repeatedly through at least July 2010. Rather than use his cell phone or another phone that was traceable to him, Allen repeatedly communicated with Bennett in person and contacted him by using a public phone at LaGuardia Airport.”
Allen was charged separately and “is presumed innocent until proven guilty,” the U.S. Attorney’s Office said.