Former Baltimore Orioles third basemen Doug DeCinces today settled insider trading charges with the U.S. Securities and Exchange Commission for $2.5 million.
DeCinces and three associates, including real estate lawyer Fred Scott Jackson, allegedly made more than $1.7 million in illegal profits when Abbott Park, Ill.-based Abbott Laboratories Inc. announced its plan to purchase Advanced Medical Optics Inc. through a tender offer.
DeCinces allegedly received confidential information about the deal, then immediately began to purchase shares of Advanced Medical Optics in several brokerage accounts, including accounts in his grandchildren's names. He made a profit of $1.3 million, according to the SEC in a complaint filed today in U.S. District Court for the Central District of California.
DeCinces was represented by McDermott, Will & Emery partners Gordon Greenberg and Hoyt Sze. Neither could immediately be reached for comment.
Jackson, a solo practitioner in Irvine, Calif., bought 11,000 shares of stock on the basis of DeCinces' tip before the public announcement, making a profit of $140,259. He settled with the SEC for $293,026. DeCinces’s physical therapist, Joseph Donohue, made $75,570 and settled for $113,355. Businessman Roger Wittenbach, a longtime friend of DeCinces, netted $201,692 and settled for $422,366.
None of the defendants admitted or denied the SEC’s allegations.
According to MLB.com, DeCinces helped coin the term “Orioles Magic” during a ninth inning at-bat in June 1979, when he hit a two-run homer to defeat the Detroit Tigers. He also played for the California Angels and the St. Louis Cardinals.
“Time and again, we see reputable people engaging in insider trading and risking their good names in order to enrich themselves and those around them,” said Daniel Hawke, chief of the SEC Division of Enforcement’s Market Abuse Unit and director of the Philadelphia regional office in a news release. “People need to understand that we are watching for suspicious trading activity, and they will pay a heavy price when we catch them insider trading.”