Long Island Investment Advisor Pleads Guilty To Insider Trading

Earlier today in federal court in Brooklyn, Tibor Klein, a registered investment advisor, pleaded guilty before United States District Judge Joan M. Azrack to one count of conspiracy to commit securities fraud.

Today’s guilty plea was announced by Bridget M. Rohde, Acting United States Attorney for the Eastern District of New York, and Philip R. Bartlett, Inspector-in-Charge, United States Postal Inspection Service, New York Division (USPIS).

According to court documents, Klein had received material, non-public information regarding the pending merger between Pfizer, Inc., and King Pharmaceuticals, Inc., from his client and friend, Robert Schulman, a former partner of a Richmond-based global law firm. Schulman had learned of the information through his representation of King Pharmaceuticals. Klein and another co-conspirator then used that material, non-public information to engage in securities transactions ahead of the merger announcement that resulted in more than $400,000 in illegal profits.

At sentencing, Klein faces a maximum sentence of five years’ imprisonment. Schulman was convicted of securities fraud and securities fraud conspiracy following a jury trial in March 2017.

Ms. Rohde thanked the USPIS for its hard work and dedication in leading the investigation and expressed her appreciation to the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority, Inc., Criminal Prosecution Assistance Group (FINRA CPAG) for their cooperation and assistance.

The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys David C. Pitluck, Julia Nestor and Patrick T. Hein are in charge of the prosecution.

The Defendant:

Name: TIBOR KLEIN

Age: 43

Residence: Melville, New York

E.D.N.Y. Docket No. 16-CR-442 (JMA)