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Ex-GE Exec Accused of Insider Trading

July 30, 2002|From Reuters

A former General Electric Capital Corp. executive and a kung fu instructor have been charged in an insider-trading scheme stemming from General Electric's purchase last year of Heller Financial Inc., federal prosecutors said on Monday.

Anthony Chrysikos, 39, of Edgewater, N.J., a former vice president of finance in the aircraft services division of General Electric Capital Corp., surrendered on Friday and was released on a $350,000 personal recognizance bond. GE Capital is a unit of Fairfield, Conn.-based General Electric Co.

The other defendant, Michael Martello, 35, who was living in Taiwan at the time of the alleged scheme, surrendered to federal authorities on Monday and was expected to be arraigned in federal court in Manhattan.

If convicted, both men face a maximum sentence of five years in prison on one conspiracy count and 10 years in prison on each of four securities fraud counts.

GE Capital announced a $5.3-billion cash tender offer for Heller Financial's stock on July 30, 2001. Heller Financial is a commercial lender based in Chicago.

The complaint alleges that Chrysikos, who had been a member of the GE Capital deal team involved in the Heller Financial transaction, tipped off Martello. Martello allegedly purchased Heller Financial call options before the deal was publicly announced and later sold them at a $157,259 profit.

A spokesman for the Manhattan U.S. attorney's office said he did not know the relationship between the two men.

The two defendants were named in a related civil suit filed by the Securities and Exchange Commission in March.

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