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Jul. 16, 1997
NEW YORK (AP) _ Twelve people were accused of securities fraud Wednesday for allegedly using confidential information to trade in Independence Bancorp Inc. stock before it announced plans to merge with CoreStates Financial Corp. in 1993.
The defendants made at least $750,000 in profits from unlawful trades, the Securities and Exchange Commission said in a civil complaint filed in federal court in Philadelphia. They are charged with insider trading. The SEC wants them to turn over the alleged illegal profits and pay other penalties.
The 12 include three people with ties to Independence Bancorp: former bank director Robert Hunter, and Thomas Pileggi and W. Kenneth Greenwood, former directors of the bank's subsidiary Cheltenham Bank. The others are friends, relatives and business associates of the three.
The SEC said Hunter, Pileggi and Greenwood learned in late October or early November that Pennsylvania-based Independence had received an offer from CoresSates. The three bought shares in the bank before the information was made public on Nov. 19, 1993 and tipped off the others.
The defendants sold their shares at a profit after the deal was announced and boosted the value of the company's stock.
The SEC said five of the defendants, but not the three former bank insiders, have agreed to settle the case and turn over about $36,000 in illgotten gains and pay penalties equal to their profits. They did not admit or deny the charges, The SEC said.