Feb 5 (Reuters) - A former partner at the law firm Fox Rothschild was found guilty on Friday of engaging in insider trading after learning that a client at his law firm was about to announce a merger, prosecutors said.
Herbert Sudfeld, 64, was convicted on charges of securities fraud and making a false statement by a federal jury in Philadelphia following a four-day trial, prosecutors said.
The Doylestown, Pennsylvania-resident faces a maximum sentence of 25 years in prison, according to the U.S. Attorney’s Office in Philadelphia. His lawyer, Robert Welsh, did not immediately respond to a request for comment.
Sudfeld was indicted in July on charges that he engaged in the insider trading while he was a partner at Fox Rothschild, which represented insurer Harleysville Group Inc in its $760 million merger with Nationwide Mutual Insurance Co in 2011.
According to the indictment, Sudfeld, a real estate lawyer, learned his partners were representing Harleysville two days before the merger was announced and bought stock in the company ahead of the news.
When the merger with Nationwide was announced, Harleysville’s stock rose about 85 percent. Sudfeld then sold the shares he had bought just a day earlier, reaping $75,530 in profits, prosecutors said.
Prosecutors said that Sudfeld, who ceased working at the law firm in 2012, later made false statements to Federal Bureau of Investigation agents investigating insider trading.
The case is U.S. v. Sudfeld, U.S. District Court, Eastern District of Philadelphia, No. 15-cr-00330. (Reporting by Nate Raymond in New York; Editing by Bernard Orr)