PR Guy Arrested And Accused Of Insider Trading On His Clients' Press Releases

A Wall Street investor relations person has been charged with insider trading for allegedly buying and selling stocks from company press releases prepared for his firm's clients, U.S. Attorney Preet Bharara said in a statement.

Michael A. Lucarelli, the director of market intelligence at Lippert Heilshorn & Associates, was arrested and charged with 13 counts of insider trading on Tuesday. His alleged scheme netted him at least $538,215.32 in ill-gotten gains, the release said.

"As alleged, and despite the well-known parade of convicted insider trading perpetrators over the past several years, Michael Lucarelli was not deterred and violated both his company's policies and his responsibility to its clients by trading on material nonpublic information for his personal financial gain. For the over $500,000 he earned from his illicit trades he is charged with 13 counts of securities fraud," Bharara said in a statement.

According to the complaint, Lucarelli would allegedly take positions in stocks mentioned in press release drafts being prepared for his firm's clients. Right after the release was made public, he would exit the position profiting on the stock's price movement.

Bharara's office said that the FBI got a search warrant this summer and searched Lucarelli's office without him knowing. The FBI found a locked briefcase that contained draft press release of TREX's quarterly financial results. The FBI discovered that he had been purchasing shares of TREX between July 25 and August 1. He was able to net $90,000 on that particular stock, the release said.

Lucarelli allegedly traded in 13 different securities from August 2013 until at least August 2014 using non-public info from press releases. Bharara's office said the FBI has discovered "numerous additional trades" and that the investigation is still on going.

If convicted, Lucarelli faces a maximum of 20 years in prison for each of the 13 counts and a maximum fine of $5 million per count.