A former Shaw Group executive who pleaded guilty to insider trading involving the Baton Rouge firm's $3 billion acquisition in 2012 by Chicago Bridge & Iron Co. was ordered Thursday to spend six months in a halfway house as part of a three-year period of probation.
Scott David Zeringue also was fined $5,000 by Chief U.S. District Judge Brian Jackson and ordered to pay $32,000 in restitution, much of which Zeringue has already paid. That is the amount of money he pocketed from the insider trading.
Zeringue faced a possible prison term of 37 to 46 months, but federal prosecutors noted Zeringue's acceptance of responsibility and his cooperation with the government in urging the judge to put him on probation instead.
A convicted former Shaw Group executive testified Thursday he tipped off his brother-in-law …
Zeringue, who was vice president of construction operations for Shaw, told Jackson he is "ashamed, remorseful and sorry" about his criminal conduct.
"I want to publicly ask for forgiveness," Zeringue said to Jackson in a courtroom packed with his supporters, many of whom wrote letters to the judge. Zeringue asked the judge for leniency and said he won't let his "fall from grace" define his life.
He pleaded guilty in 2014 to conspiracy to commit securities fraud and testified in August against his brother-in-law, Ruston dentist Jesse H. Roberts III, who was acquitted by a Baton Rouge federal court jury of securities fraud and securities fraud conspiracy. Federal prosecutors alleged Roberts turned a $700,000 profit from confidential information that Zeringue said he passed on to his brother-in-law.
A Ruston dentist whose brother-in-law worked at the Shaw Group in 2012 was acquitted Thursda…
Zeringue's attorney, David Rozas, told Jackson his client cooperated with federal authorities beginning in 2014 and has never "played the victim" or made excuses for his criminal conduct.
"He chose the government over his brother-in-law. He chose honesty," Rozas said.
Assistant U.S. Attorney Chris Dippel told the judge that Zeringue's cooperation in the insider trading probe was exceptional and said probation would be an appropriate sentence.
"This defendant stands out" in terms of his cooperation, Dippel said. "He chose the right path."
Jackson acknowledged the "extraordinary" nature of the government's request for probation in such a case.
"This was indeed a very, very serious crime," he told Zeringue. "What you did was absolutely wrong."
Jackson added that Zeringue's insider trading was not a victimless crime, noting that it compromised the integrity of Shaw and CB&I, and shook the confidence of the investing public.
Zeringue's brother-in-law, Roberts, allegedly told another Ruston resident, Billy J. Adcox Jr., about the information he received from Zeringue. Adcox was indicted in 2015, accused of making a $37,000 profit from his alleged insider trading activities, but prosecutors dismissed the charges against Adcox after Roberts was found not guilty.
Roberts' attorneys argued at his trial that information about Shaw's planned sale had been leaking out and that Roberts, an experienced trader, used information available to the public to invest in Shaw stock options and hit the jackpot.
Three others, including former Shaw employee Kelly Liu, were indicted in July and accused of insider trading and illegally profiting from the company's sale.