Steven McClatchey, a former director at Barclays, was recently taken into custody, after a plumber friend told the FBI that McClatchey agreed to give him some trading tips if he fixed his bathroom for free.
Reportedly, the banker provided the plumber with insider info on pending mergers and purchases he learned about when he was working at the bank. As a result the plumber made a small fortune of five figures between March 2014 and August 2015.
McClatchey now faces a series of charges including securities and wire fraud. He was arrested by the feds Tuesday at his Long Island residence and was later released without a bail after a brief court hearing.
According to the Securities and Exchange Commission which sued the plumber in a separate case, McClatchey’s friend is a 47-year-old man called Gary Pusey.
The two men became close friends in 2011, when they met the Yachtsmen’s Cove marina. Ever since they spent their weekends at the marina and sometimes the former banker leaked trading tips to his friend.
Nevertheless, McClatchey urged Pusey not to tell anybody about the info, not even his family.
According to court documents, the plumber used the tips to make $76,000 in profit on the stock market. In return, Pusey gave his friend his share of the cash and agreed to fix the banker’s bathroom at no charge.
The plumber was also charged with fraud and he is now cooperating with prosecutions in hopes to get a lower sentence. Both men’s attorneys declined any request for comment. McClatchey’s attorney said that he doesn’t provide any details on the case outside the court.
The SEC said that McClatchey had access to valuable trading tips since he worked at the bank’s investment division and had close ties with Barclays’ director of mergers and acquisitions.
According to the SEC report, the banker compiled weekly reports on the potential mergers regarding the bank’s clients for the company’s top managers. The bank said in a recent statement that it has fully cooperated with federal investigators.
The bank reassured clients that its employees are rigorously trained to have an “extensive conduct and compliance” when addressing present and potential clients’ matters. The company added that it puts a high value on integrity and respect.
McClatchey was a director at the bank’s Manhattan arm between Dec. 2008 and Dec. 2015.
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