NEW YORK (AP) — A former executive at a New York investor firm pleaded guilty to an insider trading charge Wednesday, blaming long work hours and drugs in part for his use of information from drafts of press releases to earn nearly a million dollars.
Michael Lucarelli entered the plea to a federal securities fraud charge on Wednesday, his 52nd birthday, agreeing with prosecutors that federal sentencing guidelines call for a prison sentence of between three and four years. Sentencing was set for Jan. 8.
Lucarelli, wearing a suit, strolled out of the courthouse afterward beside his attorney, Patrick W. McGinley. His exit contrasted with his attempt to elude photographers after his August arrest. Then, he ran out of his sandals racing down the sidewalk in a tank top and slacks, earning him a mocking "Moment of Zen" on "The Daily Show With Jon Stewart."
As he described his crime to U.S. District Judge Jesse M. Furman, Lucarelli apologized and paused briefly to cry.
He said long hours at Manhattan-based investor relations firm Lippert/Heilshorn & Associates Inc., where he was director of market intelligence, his failure to take vacation for two years and complications from Crohn's disease that led to a dependence on drugs were in part to blame for his illegal trading over the last year. He said commissions for his work sometimes were not paid in a timely manner.
"Fueled by anger at not getting paid and a dependence on drugs, I made a serious mistake," Lucarelli said. He added that it was the first time he had run afoul of the law in his quarter of a century in the business.
"I apologize to the court for my decision to trade on material nonpublic information," he said. "I wasn't strong enough to resist. I'm very remorseful."
The judge asked several questions about the trades he carried out in the securities of 13 of the firm's clients.
"Because of the physical pain and the dependence on drugs, I can't remember," he said in one answer.
In a release, U.S. Attorney Preet Bharara said: "For using his company's and clients' secrets for his own personal gain, he now faces time in federal prison and the forfeiture of over $900,000 that he unlawfully obtained."
McGinley said Lucarelli has no money and will await sentencing at the home of a brother in North Dakota.
The lawyer said his client has "no ability to live here anymore."