Former executive gets prison in insider trading case
Jan. 21, 2015
NEW YORK (AP) — A former executive at a Manhattan investor firm was sentenced to 2½ years in prison Wednesday by a judge who criticized his explanation that he turned to crime because he thought his bosses cheated him.
U.S. District Judge Jesse M. Furman said incarceration was "absolutely necessary" for Michael Lucarelli, 52, who pleaded guilty in September to a securities fraud charge.
Prosecutors said Lucarelli made trades ahead of companies' public announcements, using information from draft press releases he saw while working as director of market intelligence at investor relations firm Lippert/Heilshorn & Associates Inc.
Lucarelli must forfeit more than $958,000 he earned illegally from August 2013 until his arrest last August.
The judge noted a Probation Department report said Lucarelli "blames everyone except himself."
Earlier, a tearful Lucarelli said he hoped to sue his former employer for unpaid commissions.
"They were stealing from me and I got desperate," he said. Lucarelli also blamed his dependence on drugs to cope with 14-hour work days and medical problems stemming from Crohn's disease.
Lucarelli said he had lost all his money, his marriage and been rejected by friends. He said he was studying to become a truck driver because the trucking industry would not care about his insider trading conviction "if you're a great driver, which I am."
The judge agreed Lucarelli won't have to report to prison until April so he can attend a 10-week truck training program in Indianapolis.
His lawyer, Patrick W. McGinley, had requested leniency, saying his client was remorseful and had only committed a crime because he was angry at his employer.
"His self-help plan was not wise, nor was it legal," McGinley said.
Assistant U.S. Attorney Brian Blais urged a sentence of at least three years in prison, citing the long duration of the crime and the inappropriateness of Lucarelli's claimed motivation.
U.S. Attorney Preet Bharara said Wednesday "Lucarelli took part in corrupting our markets by abusing his access to nonpublic information."
When Lucarelli was arrested in August, he ran out of sandals fleeing photographers outside court. His behavior earned him a mocking on a segment of "The Daily Show with Jon Stewart."
Recalling his arrest Wednesday, Lucarelli said it was traumatic when FBI agents arrived at his door with guns pointed down, leading him to fear for his pets.
He said he shouted: "All the pets are innocent. Don't shoot the pets!"