U.S. SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 18384 / October 1, 2003
COMMISSION CHARGES FRANCES J. BURKITT AND PAUL BURKITT WITH INSIDER TRADING
, Civil Action No. L 03-cv-2767 (D. Md.)
The Securities and Exchange Commission ("Commission") announced the
filing, on September 29, 2003, of a complaint in the United States
District Court for the District of Maryland, alleging insider trading
in the securities of RMH Teleservices, Inc. by defendant Frances J.
Burkitt ("F. Burkitt"), of Arnold, Maryland. F. Burkitt sold RMHT
stock while in possession of material, nonpublic information
concerning negative financial news to be announced by RMHT, which he
had received from defendant Paul Burkitt ("P. Burkitt"), of Wayne,
Pennsylvania, his son and an officer of RMHT. The complaint seeks
permanent injunctions for violations of the antifraud provisions of
the federal securities laws, disgorgement and civil penalties. As
described below, the defendants have agreed to settle this matter.
RMHT, headquartered in Newtown Square, Pennsylvania, provides customer
relationship management services for corporations in the technology,
telecommunications, financial services, insurance, and other
industries. Its stock is traded on the NASDAQ National Market. For
fiscal year 2001, RMHT reported revenue of $174 million and a net loss
of $17.6 million. RMHT's fiscal year ends September 30th.
The Commission's complaint alleges that on January 4, 2001, RMHT
announced that it expected a loss for its first fiscal quarter ended
December 31, 2000, and lowered revenue estimates for fiscal year 2001.
Following the announcement, the price of RMHT stock declined sharply,
closing at $3.50 per share, down 50 percent from the previous day's
close of $7 per share.
The complaint alleges that P. Burkitt was RMHT's Executive Vice
President of Sales and Marketing, and knew throughout the company's
first quarter that its financial condition was deteriorating. He also
knew that RMHT was going to announce revised revenue and earnings
estimates, and that his father owned RMHT stock. In a telephone
conversation on the evening of January 2, 2001, P. Burkitt tipped his
father about RMHT's upcoming negative announcement. On January 3,
2001, prior to RMHT's announcement, F. Burkitt sold 10,000 shares, his
entire holdings of RMHT stock. As a result of his illegal trading, F.
Burkitt avoided losses of $33,987.
Simultaneously with the filing of the complaint, and without admitting
or denying the Commission's allegations, the defendants consented to
SNIPPETS:
U.S. SECURITIES AND EXCHANGE COMMISSION
COMMISSION CHARGES FRANCES J. BURKITT AND PAUL BURKITT WITH INSIDER TRADING
The Securities and Exchange Commission announced the filing, on September 29, 2003, of a
Burkitt"), of Arnold, Maryland.
F. Burkitt sold RMHT stock while in possession of material, nonpublic information concerning
The complaint seeks permanent injunctions for violations of the antifraud provisions of the
the defendants have agreed to settle this matter.
RMHT, headquartered in Newtown Square, Pennsylvania, provides customer relationship
Its stock is traded on the NASDAQ National Market.
The Commission's complaint alleges that on January 4, 2001, RMHT announced that it expected a
Following the announcement, the price of RMHT stock declined sharply, closing at $3.50 per
He also knew that RMHT was going to announce revised revenue and earnings estimates, and that
Simultaneously with the filing of the complaint, and without admitting or denying the
ivil penalty in the amount of $33,987.
The Commission acknowledges the assistance of NASD Regulation, Inc. in this matter.
|
