The **U.S. Securities and Exchange Commission** (SEC) has **accused** David Roda, a former software developer at Penn Interactive Ventures, of **illegally trading on inside information** related to the **takeover** of Score Media and Gaming.
The SEC’s **legal action**, filed in the U.S. District Court for the Eastern District of Pennsylvania, **claims** that Roda, while working at Penn Interactive Ventures, **obtained private information** about Penn National Gaming’s **purchase** of the Canadian firm theScore and was **instructed** not to use the information for trading.
Roda **broke his obligations** and **bought** 500 out-of-the-money call options on Score Media in the weeks and days **before** the acquisition announcement. The **takeover** was ultimately **finalized** last October, after it was first **revealed** in August.
Roda also **informed** his friend, Andrew Larkin, about the deal, who then **bought** 375 shares of Score Media stock. The SEC has also **charged** Larkin in connection with the **scheme**.
As per the U.S. Securities and Exchange Commission (SEC), the share price of Score Media climbed dramatically by nearly 80% after Penn National and Score Media publicly declared their agreement. Subsequently, Roda and Larkin sold their holdings, generating a profit of $560,762 (460,873 GBP/538,199 EUR) and $5,602 respectively.
The SEC claims that Roda and Larkin breached the anti-fraud regulations of the securities laws.
Roda consented to a permanent ban from violating these provisions and agreed to pay restitution, pre-judgment interest, and a civil penalty, the sum of which will be determined by the court at a later time.
Larkin neither acknowledged nor denied the accusations but agreed to a permanent ban from violating the anti-fraud regulations of the securities laws and to pay over $11,000 in restitution and penalties.
Furthermore, the U.S. Attorney’s Office for the Eastern District of Pennsylvania announced criminal charges against Roda.
“As we claim, Roda was entrusted by his employer with significant, market-shifting inside information, and he violated that trust by using that information to trade and by informing his friend so they could both benefit,” stated Scott Thompson, Acting Regional Director of the SEC’s Philadelphia Regional Office.
“When employees like Roda misuse confidential information and trade on it, it weakens market confidence. The SEC is dedicated to finding, investigating, and prosecuting those who participate in insider trading.”
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