A Hampton man pleaded guilty to four counts of securities fraud after prosecutors charged him with engaging in 160 trades of Dick’s Sporting Goods stock after receiving insider information from a company employee.
Frank T. Poerio Jr., 62, made the transactions between August 2019 and May 2021, U.S. Attorney Eric Olshan said. The nonpublic information came from a data analytics employee in the sporting goods company’s Moon headquarters.
Olshan said Poerio purchased shares and call option contracts, which are financial contracts that give a buyer the right — but not the obligation — to buy a stock, bond, commodity or other asset at a specified price within a specific period.
The trades netted Poerio about $823,000, prosecutors said. The Dick’s employee was not identified.
“Insider trading erodes the foundation of our economy and undermines public trust in our institutions. This is not simply a casual, petty crime,” said FBI Pittsburgh Special Agent in Charge Kevin Rojek. “The FBI will persistently pursue those who believe they can abuse their position to unfairly reap financial gains at the expense of others.”
Several of the trading instances came in the days immediately preceding Dick’s release of periodic earnings statements — referred to as “blackout” periods when company employees were prohibited from trading in Dick’s securities.
“Frank Poerio admitted to gaming the system by using material nonpublic information from a company employee to conduct well more than a hundred trades over the course of several years that resulted in nearly a million dollars in profit,” U.S. Attorney Olshan said.
Poerio is scheduled for sentencing Oct. 31 before U.S. District Court Judge Marilyn Horan. He faces up to 20 years in prison, a $5 million fine or both.
