Ex-Barclays banker pleads guilty to passing inside info to plumber

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Former Barclays director pleaded guilty to passing on insider-trading tips to his plumber

Steven McClatchey, 58, pleaded guilty to one count of conspiracy and one count of wire fraud in Manhattan federal court. McClatchey said he passed on information about mergers and acquisitions deals he misappropriated from his former employer and passed them to his friend, Gary Pusey.

McClatchey worked for seven years at the Manhattan office of Barclays, where he was responsible for tracking the bank’s involvement in potential mergers and acquisitions. He distributed a weekly document to select Barclays employees called “M&A Global Weekly Business Update,” which included deals that were likely to become public the following week.

McClatchey said on July 12 that Pusey, a plumber, gave him cash in exchange for the tips. Prosecutors said Pusey also performed tiling and other renovations for McClatchey for the inside information. Pusey then used the tips to make profitable trades on the stocks of around 11 publicly traded companies, pulling in $ 76,000 in illegal profits, prosecutors said.

Pusey, 47, pleaded guilty in May to his participation in the scheme and has been cooperating with the government, according to a criminal complaint filed by the Manhattan US attorney’s office. The Securities and Exchange Commission also filed civil insider-trading charges against the two men.

Barclays, which is described in the complaint only as “Investment Bank A,” said it has cooperated with the government “since learning about this incident involving a former employee”. McClatchey worked in a back-office role and didn’t interact directly with clients, according to a person familiar with the matter.

McClatchey’s sentencing is scheduled for October. He agreed not to appeal any sentence of five years in prison or less under the terms of his plea deal.

Write to Christopher M Matthews at christopher.matthews@wsj.com

This story was first published by The Wall Street Journal

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