Broker banned in Skadden trading case
Legal Week Reports
September 15, 2004 at 08:03 PM
2 minute read
The husband of a former secretary from Skadden Arps Slate Meagher & Flom, who plunged the law firm into the centre of an insider trading row, has been banned from associating with brokers following the settlement of a court case.
The civil case, alleging insider dealing by bond trader Fiore Gallucci, was brought by the Securities and Exchange Commission in June, and was settled on 9 September, with Gallucci facing further court action should he associate with any broker or dealer.
The controversy surrounding Gallucci stemmed from his wife, who was a secretary at Skadden, and claims that he engaged in insider tipping by learning the identities of target companies for major acquisitions through his wife's job in the firm's renowned M&A practice.
After learning of the charges, Skadden dismissed the secretary for allegedly breaching the confidentiality agreement that every staff member signs when they join the New York giant.
While the case draws a line under the civil case against Gallucci – he consented to the findings, without admitting or denying them – he still faces the prospect of further punishment relating to federal felony charges brought by the US Attorney's Office in New York.
He has pleaded guilty to the charges and is currently awaiting sentencing.
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