CHICAGO (CN) - Two real estate men, one of them an attorney, made nearly a quarter of a million dollars from inside trading, the SEC says. Ralph Pirtle was director of Real Estate for Philips Electronics when he tipped off Morando Berrettini about Phillips' upcoming deals, the SEC claims in Federal Court.
Berrettini, 66, of Lake Forest, also holds a real estate license and owns Berco Realty, which became a "preferred real estate vendor" for Philips through Pirtle, according to the complaint.
Pirtle, 49, of South Carolina, tipped Berrettini to Phillips' interest in acquiring three publicly traded medical and health-care companies, the SEC says.
Pirtle allegedly tipped Berrettini to Phillips' intent to buy Lifeline Systems, Invacare and Intermagnetics. Berrettini then quickly bought stock in those companies, according to the complaint, and made more than $240,000 from it, the SEC says.
in ill-gotten profits.
SEC prosecutors say Berrettini "made a series of payments to third parties on Pirtle's behalf in the form of cashier's checks. These payments were made on 17 separate occasions in amounts ranging from $1,700 to as much as approximately $36,000. The total amount of the alleged loans was over $226,000.
"The payments were made to pay for, among other things, cars, trips to Las Vegas, and gambling.
"During the investigation, Berrettini presented signed promissory notes that purported to document that these payments were arms-length loans. Pirtle had not made payments on any of these alleged 'loans' when the investigation began. Pirtle admitted that he would have been fired if Philips learned about the alleged 'loans.'"
Berrettini claimed that his stock purchases were based on a "hunch," the SEC says.
The SEC demands disgorgement and civil penalties from Pirtle and Berrettini for aiding and abetting and insider trading.
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