NEWS
14 June 2022
Ex-Penn employee charged with insider trading by SEC
By Gambling Insider

The US Securities and Exchange Commission (SEC) has filed charges against Roda in connection with Penn’s $2bn acquisition of Canada’s Score Media and Gaming.

While employed as a software engineer at Penn Interactive Ventures, the SEC said that Roda was given confidential information concerning the takeover. He then used this information to purchase 500 out-of-the-money call options on Score Media for approximately $20,000 in the days and weeks leading up to the acquisition’s announcement.

The SEC further claims that Roda disclosed this information to his long-time friend, Andrew Larkin, who then purchased 375 Score Media shares.

After the deal was announced, Score Media’s stock price rose by nearly 80%. Roda and Larkin then sold their holdings, netting $560,762 and $5,602 in “unlawful profits,” respectively.

“As we allege in our complaint, Roda was entrusted by his employer with critical, market-moving information, and he betrayed that trust by using the information to trade and also tip his friend so they could both profit,” said Scott A. Thompson, Co-Acting Regional Director of the SEC’s Philadelphia Regional Office.

“When employees like Roda misappropriate and trade on confidential information, it erodes market confidence. The SEC remains committed to finding, investigating and charging those who engage in insider trading.”

The SEC’s complaint charges both men with violating the anti-fraud provisions of US securities law.

Roda has agreed to be “permanently enjoined from violating those provisions,” and has agreed to pay “disgorgement, prejudgement interest and a civil penalty,” to be determined at a later date.

Meanwhile, Larkin, without admitting to or denying the SEC’s allegations, has agreed to similar terms and will pay more than $11,000 in disgorgement and penalties.

Jacqueline Maguire, Special Agent in Charge of the FBI’s Philadelphia Division, remarked: “David Roda allegedly traded on material, non-public information and made out like a bandit.

“Insider trading like that is patently unfair to investors and a direct threat to the integrity of our financial markets.”