Lowell Defense Attorney Pleads Guilty to Trading on Insider Information
BOSTON – A Lowell defense attorney pleaded guilty yesterday in U.S. District Court in Boston in connection with his role in a conspiracy to use inside information about business activities of American Superconductor Corporation (AMSC) to profit from trading AMSC stock.
Douglas Parigian, 56, pleaded guilty to a superseding information charging him with conspiracy and securities fraud. U.S. District Court Judge Denise J. Casper scheduled sentencing for Aug. 17, 2015.
Starting in or about July 2009, a friend of Parigian’s, Eric McPhail, began giving Parigian and others inside information about AMSC’s business activities and upcoming earnings announcements. McPhail obtained this information during golf matches, dinners, and other social outings with a close friend who was a senior executive at AMSC. The executive trusted McPhail to keep the information to himself and was unaware that McPhail was instead tipping his own friends. Between July 2009 and April 2011, Parigian, who knew the information was confidential and that it was improper for McPhail to disclose it, nonetheless repeatedly traded on it, making over $200,000 in illicit gains and avoided losses.
The securities fraud charge provides a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $5 million. The conspiracy charge provides a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000 on each count. Actual sentences for federal crimes are typically less than the maximum penalties. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement today. The United States Attorney’s Office received valuable assistance from the Securities & Exchange Commission in the course of investigating this case. The case is being prosecuted by Assistant U.S. Attorneys Andrew E. Lelling of Ortiz’s Economic Crimes Unit and Seth B. Kosto of Ortiz’s Cybercrime Unit.