Two men have been charged with insider trading related to Penn Entertainment’s $2 billion acquisition of theScore.
The Securities and Exchange Commission filed insider trading charges against stock broker Jordan Meadow and Steven Teixeira on June 29. The pair are charged with several instances of insider trading, one of which involved theScore. Concurrently, the Southern District of New York’s US Attorney’s Office are filing criminal charges against the pair as well.
Teixeira worked as the Chief Compliance Officer for LianLian Global’s US business. During the pandemic, he was working out of his apartment alongside his girlfriend, who worked as an executive assistant at an investment bank.
While his girlfriend was out of the apartment, Teixeira would look at her computer to check her calendar and emails. He would then relay that information to a third party, who would then pass it along to Meadow to put to use at his brokerage.
The girlfriend was aware Teixeira was looking at her computer. According to the complaint, Teixeira gave her a device to keep her mouse moving so tracking software from her computer could not detect she was away from her desk. Additionally, she instructed Teixeira to keep an eye on her email and notify her if anything urgent came into her inbox.
Across several different incidents of insider trading, Teixeira allegedly profited almost $30,000, Meadow allegedly profited over $730,000, and the firm Meadow worked for made millions of dollars for its customers.
In the instance of theScore, Teixeira profited $1,151 on trading of the stock. Meadow generated $33,709 in profits.
The real impact came from the 60 brokerage customers who purchased a combined total of more than 300,000 shares, investing more than $6 million in the stock.
When Penn announced its intent to acquire theScore in August 2021, shares of theScore jumped up 80% from the previous day. Sales of the brokerage stock netted the company’s clients around $5 million and earned six-figure commissions for Meadow and his associate.
This is not the only insider trading case related to theScore and Penn. Last year, the SEC fined Penn employee David Roda for purchasing 500 shares of Penn stock the day before the announcement of the acquisition.