Healthy lifestyle tips aren’t the only thing Timothy McGee received at Alcoholics Anonymous (AA) meetings. The Ameriprise Financial Services financial adviser also obtained insider information that helped him and his acquaintances reap nearly $2 million in illicit profits.
Yesterday, the Securities and Exchange Commission (SEC) charged McGee with insider trading, saying he used information from a fellow AA attendee who was an executive of the Philadelphia insurance company Philadelphia Consolidated Holding Corp. to profit off of the company’s $4.7 billion takeover in July 2008.
McGee and the Philadelphia Consolidated executive had been attending AA meetings together for more than a decade. In the spring of 2008, the executive mentioned to McGee that Philadelphia Consolidated was in merger discussions with Japanese insurance company Tokio Marine.
Although McGee promised to keep the merger details a secret, he bought shares in the company and also told his co-worker Michael Zirinsky about the upcoming deal. Zirinsky then called friends in Hong Kong as well as multiple family members to tell them to buy stock. The SEC reports that the Zirinsky family acquired $700,000 of stock in just one day.
An Ameriprise spokesperson told the Wall Street Journal that the company has suspended McGee and Zirinsky.