The Maryland Port Administration's former deputy director agreed yesterday to pay $36,500 to settle insider stock trading allegations involving the sale of Baltimore Bancorp in 1994.
G. Gregory Russell, the former MPA official, who also was on the bank's board of directors, neither admitted nor denied the allegations, filed by the Securities and Exchange Commission. The settlement came on the day the SEC's civil case was to have gone to trial in U.S. District Court in Baltimore.
The SEC had alleged that Russell tipped off his boss, MPA Executive Director Michael P. Angelos, about the bank's impending sale to First Fidelity Bancorp. Angelos made two stock purchases of the bank totaling 8,600 shares before the sale was announced in January 1994.
Angelos reached a similar settlement with the SEC in March 1996. He agreed to pay the government $61,762, which included $36,650 in alleged illegally obtained profits plus civil penalties.
A year-long civil investigation had focused on Angelos' purchase of Baltimore Bancorp stock while the bank's management was actively seeking bids that resulted in its $346 million acquisition by New Jersey-based First Fidelity.
Both Russell and Angelos resigned their posts at the MPA shortly after the federal investigation came to light in March 1995.
A $50,000 check Russell wrote to cover Angelos' stock purchase was a focal point of the federal investigation. The check prompted speculation that the money might have come not from Russell, an $85,000-a-year state official, but from a third party.
Kevin O'Rourke, the SEC's assistant chief litigation counsel, said yesterday that the money came from Russell's brokerage account. But O'Rourke declined to comment on whether investigators believed the money was Russell's.
He said a permanent injunction was filed in federal court yesterday that officially concluded the SEC's investigation.
The case was one of about 40 insider trading actions filed nationwide during the past year by the federal regulation agency.
Pub Date: 7/08/97
