James Cope, a former Pinnacle Financial Partners director who pleaded guilty to insider trading in October, was supposed to pay a $55,000 fine as part of a plea deal. But the judge hearing the case contends he should pay more.
U.S. District Judge Aleta Trauger in Nashville, Tenn., said Monday that the amount of the fine was too low given Cope's net worth, according to court documents. Cope was scheduled to be sentenced, but the judge ordered his lawyer, Aubrey Harwell Jr. of Neal & Harwell, and the government to reach an alternative agreement.
"The court informed the parties that the fine in the plea agreement would not be accepted by the court," a note from the documents says.
The hearing is to reconvene, but a date has not been set.
In October, Cope reached an agreement with the U.S. attorney for the Middle District of Tennessee to plead guilty to one count of insider trading. He would serve a two-year probationary sentence, including nine months of home confinement, and pay the $55,000 fine. Cope faced a maximum penalty of 20 years in prison, three years of supervised release and a $5 million fine.
The $11 billion-asset Pinnacle disclosed in an April regulatory filing that Cope bought stock in Avenue Financial Holdings in January after he learned of the Nashville companies' merger discussions at an executive meeting earlier in the month.
The Securities and Exchange Commission is pursuing its own case against Cope. The SEC charges that Cope, who resigned from Pinnacle's board in April, used the information to buy roughly 10,000 Avenue shares and received more than $56,000 after the company agreed to be sold to Pinnacle.
Pinnacle completed the Avenue acquisition in July.