WASHINGTON -- The Securities and Exchange Commission said it has leveled insider-trading accusations against a former loan officer of Sussex Trust Co. and a Delaware car dealer.
Barbara Jarvis, who resigned from Sussex Trust last November, and Thomas Carignan, whom she lives with in Georgetown, Del., were accused of trading violations in connection with the merger of Sussex with Wilmington Trust Co., the largest locally owned bank in the state.
Bought 2,000 Shares
In a civil complaint filed in a Delaware federal court, the SEC said Mr. Carignan bought 2,000 Sussex shares on April 5, 1991 at $ 19.25 each on the basis of confidential information from Ms. Jarvis.
She allegedly overheard her colleagues talking about the bank's merger with Wilmington Trust, which was announced a week later.
The merger deal, involving a stock swap, entitled Mr. Carignan to 1,600 Wilmington Trust shares, then trading at $38.60 each.
He held the shares through Jan. 29, when the merger closed, with Wilmington's share price at $52.50, the SEC said.
The stock has since split 2 for 1, and its price early Friday was $26, up 25 cents from Thursday's close.
Ms. Jarvis and Mr. Carignan denied the SEC's allegations. Their lawyer, Howard Schiffman, called the lawsuit "one of the weakest I have ever seen."
The SEC is seeking forfeiture of illegal profits, though an amount was not specified in the complaint, said agency lawyer Stephen Crimmins.
The SEC also is seeking a civil fine, which could be three times the illegal profits, and an injunction against future violations of securities laws.