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SEC LITIGATION RELEASE
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EXTRACTED KEY WORDS
SECURITIES UNITED HEALTHCARE DISTRICT EXCHANGE COMMISSION MINNESOTA FRAUD MICHAEL UNITED HEALTHCARE STOCK ACQUISITION SENTENCING DISTRICT COURT CIVIL CONNECTION INSIDER TRADING PRIOR MAIL FRAUD MONEY LAUNDERING PRISON MAXIMUM POTENTIAL PENALTY CHIEF JUDGE ROSENBAUM FEDERAL SENTENCING GUIDELINES CIVIL INJUNCTIVE ACTION MOONEY STEMMING ALLEGING SECURITIES EXCHANGE ACT PROMULGATED THEREUNDER STAYED PENDING CRIMINAL MATTER |
U.S. SECURITIES & EXCHANGE COMMISSION
Washington, D.C.
Litigation Release No. 17216 / November 1, 2001
United States v. Michael A. Mooney, U.S. District Court for the
District of Minnesota, Criminal Action No. 00-CR-365 JMR/ESS (D.Minn.
2000)
U.S. Securities and Exchange Commission v. Michael A. Mooney, U.S.
District Court for the District of Minnesota, Civil Action No.
99-CV-1185 JMR/FLN (D.Minn. 1999)
Mooney Criminally Convicted on 17 Counts in connection with Insider
Trading
The U.S. Securities and Exchange Commission ("Commission") and the
U.S. Attorney's Office for the District of Minnesota announced that on
October 30, 2001, Michael Alan Mooney, of Prior Lake, Minnesota and a
former vice president at United HealthCare, was found guilty by a
federal jury on eight counts of mail fraud, four counts of securities
fraud, and five counts of money laundering related to the insider
trading of United HealthCare securities. Mooney purchased call options
on United HealthCare common stock while in possession of nonpublic
information regarding United HealthCare's negotiations to acquire and
merge with the MetraHealth companies. Mooney, learned of the
acquisition by his participation in the financial analysis of the
proposed transaction. Mooney purchased 400 "options" on United
HealthCare stock immediately prior to the June 1995 public
announcement of the acquisition. Following the first news reports
about the proposed acquisition, the price of United HealthCare stock
increased 11 percent during the next two days. Mooney eventually sold
the securities, realizing a profit of approximately $274,199.89.
Mooney faces a maximum potential penalty of five years in prison
and/or a $250,000 fine on each count of mail fraud and up to ten years
in prison and/or a $1 million fine on each count of securities fraud
and money laundering. The actual sentence will be determined by Chief
Judge Rosenbaum based on the federal sentencing guidelines. A
sentencing date is expected in eight to ten weeks.
The Commission previously filed a civil injunctive action against
Mooney stemming from the same conduct in August 1999 alleging that he
violated Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 promulgated thereunder in connection with these options
purchases. The Commission's action was stayed pending the outcome of
the criminal matter.
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