Source- http://richmond.fbi.gov/dojpressrel/pressrel11/ri012711.htm
ABINGDON, VA—A former executive of the New Peoples Bank (NPB) pled guilty today to charges related to a conspiracy to commit insider trading and money laundering offenses during his tenure as senior vice president and regional director of the financial institution.
Gary A. Lawson, 58, of Lebanon, Va., waived his right to be indicted and pled guilty this afternoon to an Information charging him with one count of conspiracy to defraud the United States and one count of money laundering.
“When people invest their hard earned money, they rely upon those who control that money to act in good faith,” United States Attorney Timothy J. Heaphy said today. “Instead of protecting the assets of the customers of New People’s Bank (NPB), Mr. Lawson looked out for himself. He withheld information about the value of NPB stock and funneled transactions of that stock to his friends and family. For his brazen and repeated acts of greed, he has been held accountable. ”
NPB bank was formed on October 29, 1998 and shortly thereafter Lawson joined the group in an executive position. Under the bank’s leadership, NPB provided training to his bank officers and board members regarding insider trading. Officers, directors and employees were prohibited from trading in the company’s stock while in possession of material, non-public information about NPB. In addition, the bank would announce blackout periods during which officers and board members, as well as friends and family members, were prohibited from trading.
Today in U.S. District Court, Lawson admitted that he, and others, engaged in insider trading in order to enrich themselves. Specifically, on July 10, 2008, a bank customer contacted an NPB branch manager in West Virginia to express his interest in acquiring 500,000 shares of stock. The customer said he was willing to pay $12 per share for a total investment of $6,000,000. The branch manager contacted the Abingdon, Virginia branch of NPB and Lawson was notified of the customer’s proposal.
Lawson admitted that over the next month or so, he, and others, used this insider information to aid and assist family members and friends in obtaining $12 per share for their shares of NPB stock. The NPB board of directors was never advised of the proposed acquisition of a large block of NPB stock.
In order to facilitate the scheme, Lawson, and co-defendant Kenneth Hart, directed a not named co-conspirator to open a checking account under the name F.D. Owens, Jr. Investment Account. Three deposits were made into that account totaling $6,600,000. The source of these funds were cashiers checks remitted by the bank customer and for the purpose of purchasing NPB stock. Checks were then written out of the F.D. Owens account to pay friends and family members of the defendant for their sold stock.
At sentencing, the defendant faces a maximum penalty of five years in prison on the conspiracy charge and a potential maximum sentence of 20 years in prison on the money laundering charge.
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