Brother-in-Law From Hell: Wall Street Edition
What's the worst thing your brother in law could possibly do at a big family gathering? Get drunk and hit on your spouse? Insult your mother? Break a family heirloom?
How about hack into your home computer, discover confidential information about a private equity deal you're running, and trade on it illegally?
According to an insider trading settlement announced today by the Securities and Exchange Commission, Michael A. Stummer took "bad houseguest" to a new level when he did just that the his wife's brother in the summer of 2006.
On the weekend of July 21. Caxton-Iseman Capital (known now as "CI Capital Partners") was on the verge of announcing a deal to acquire Ryan's Restaurant Group through one of its portfolio companies, Buffet.
It happened that firm president Steven A. Lefkowitz was hosting an annual family gathering on that weekend, which included (probably for the last time) his sister Randi's day-trader husband Michael (the S.E.C. complaint didn't identify Lefkowitz by name, but it was easily deduced based on other identifying facts provided).
During the get together, Stummer snuck into Lefkowitz's bedroom office, where he hacked into Lefkowitz's computer by correctly guessing his password, according to the S.E.C. Stummer then read several confidential emails relating to the Ryan transaction.
Based on the information, Stummer snapped up 5,500 shares of Ryan's by July 24. Shortly following the public announcement of the acquisition of Ryan's on July 25, Stummer sold his entire position for a total profit of $22,351.17.
Not surprisingly, the S.E.C. came a' knockin,' and now the brother in law from hell has agreed to forfeit $46,386.66 — representing the disgorgement of his illegal trading profits, plus prejudgment interest, plus a civil penalty in an amount equal to the profits.
And needless to say, he's probably persona non grata at Lefkowitz family barbeques from now on.
by Liz Gunnison
- This Just In: Times Are Tough
- Dec 1 2008 4:23PM EST
- Huffington Post Is Worth How Much???
- Dec 1 2008 12:26PM EST
- First Photoshopped Love Handles, Now This
- Dec 1 2008 11:31AM EST
- His 401-Koz Keeps Growing
- Nov 26 2008 9:00PM EST
- Slim Pickings? Or Great Timing?
- Nov 26 2008 1:46PM EST
- Who's the Grinch in This Story?
- Nov 26 2008 8:57AM EST
- When $1 Buys More Than $100 Million
- Nov 25 2008 5:45PM EST
- Another 500-point Swing? So What.
- Nov 25 2008 1:15PM EST
- One Bailout for Wall Street and Detroit
- Nov 25 2008 10:52AM EST
- Tiger Woods Actually ... Loses?
- Nov 24 2008 3:54PM EST
- You Know Things Are Really Bad When...
- Nov 24 2008 2:15PM EST
- Beauty and the Beast
- Nov 24 2008 1:05PM EST
- Ooh La La! A Jobs Plan!
- Nov 24 2008 11:55AM EST
- Calling the Election, 82 Years Ago
- Nov 21 2008 12:45PM EST
- We Are All Patent Reviewers
- Nov 20 2008 3:12PM EST









