A former Shaw Group employee and two other Louisiana residents were convicted Thursday of insider trading in connection with Baton Rouge-based Shaw's $3 billion acquisition by Chicago Bridge & Iron Co. in 2012.
Kelly Liu, 32, and Salvador Russo III, 35, both of Baton Rouge, and Victory Ho, 38, of Morgan City, were found guilty of securities fraud and conspiracy to commit securities fraud after a three-week jury trial in Baton Rouge federal court.
Liu, who worked in Shaw's financial planning and analysis department in 2012, obtained inside information that Shaw was going to be acquired and passed the information to Ho, through another individual, and to Russo for their use in trading Shaw securities, U.S. Attorney Brandon Fremin said.
Ho and Russo bought Shaw securities before the public announcement of the merger. Ho sold his Shaw securities after the public announcement caused Shaw's stock price to rise and made roughly $300,000 from the illegal insider trading activities, Fremin said. Russo held on to his Shaw securities.
"The unanimous guilty verdicts … should send a strong message that corporate and securities fraud by insiders and others will not be tolerated and will be aggressively pursued by my office, together with our partners," Fremin said.
Federal law prohibits officers, directors and other members of publicly traded companies from using secret company information to profit from stock trades.
Scott David Zeringue, a former Shaw Group executive, pleaded guilty in 2014 to securities fraud conspiracy and was ordered last fall to spend six months in a halfway house as part of a three-year probationary period. He also was fined $5,000 and ordered to pay $32,000 in restitution.
A former Shaw Group executive who pleaded guilty to insider trading involving the Baton Rouge firm's $3 billion acquisition in 2012 by Chicago…
Zeringue testified last summer 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 conspiracy to commit securities fraud. 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 Thursday on federal insider trading charges relating to t…