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Insider Trading Figure Sentenced to Jail and Fine

February 27, 1988|PAUL RICHTER | Times Staff Writer

NEW YORK — Peter N. Brant, the mastermind of an insider trading scheme that cashed in on leaks from a Wall Street Journal stock market column, was sentenced Friday to serve eight months in jail and pay a $10,000 fine.

Brant, 35, a former star stockbroker, pleaded guilty in 1984 and became the key witness against R. Foster Winans, the former Wall Street Journal reporter who leaked Brant information on companies that Winans planned to write about in the "Heard on the Street" column. Brant bought or sold stock before the columns appeared and the scheme earned a total of $700,000 as the stocks rose or fell, with most of the money going to Brant.

Now a sales manager for a small Florida telephone company, Brant will serve his term on 80 consecutive weekends. He was also directed to perform 750 hours of community service work.

Winans, who did not cooperate with prosecutors, last month began serving an 18-month sentence at the federal prison in Danbury, Conn., and was also fined $10,000. Winans earned about $30,000 for his part in the scheme.

Brant was "at least as guilty as Mr. Winans and maybe more so," U.S. District Judge Charles Stewart said here in delivering the sentence.

Brant was Kidder, Peabody & Co.'s top-earning stockbroker in 1983, one of many young Wall Street professionals who rode the bull stock market to a life of luxury. But when his earnings began to slow, he hatched the insider trading scheme.

The sentencing ends the prosecution of all five men who were implicated in the highly publicized case, which came to light in 1984 after a Securities and Exchange Commission investigation. One of Brant's confederates in the scheme, attorney David W. C. Clark, died of chronic alcoholism Jan. 16, six days before he was to be sentenced.

Judge Stewart clearly took Brant's cooperation with federal prosecutors into account in meting out the sentence, Assistant U.S. Atty. Carl Loewenson Jr. said. "This ought to send a message to the community that if you do something criminal, you help yourself by cooperating," he added.

The apparent leniency was criticized by an attorney for Winans, Don D. Buchwald, who called the sentence a "sad commentary" and charged that Winans "was punished harshly for exercising his right to have his case brought to trial."

Winans cooperated with the Securities and Exchange Commission's investigation but did not help the U.S. Attorney's Office put together its case against the defendants.

Another man implicated in the scheme, Kenneth P. Felis, began serving a six-month jail sentence in January. Felis, Brant's college roommate and business partner, is serving his sentence on weekends in a Manhattan halfway house and is working during the week at his family's label business in Connecticut.

Felis was ordered to pay a $25,000 fine.

The fifth defendant in the case, David Carpenter, who was Winans' roommate, was given five years' probation.

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