Ex-Pinnacle Financial board member pleads guilty to insider trading
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By Nate Raymond
(Reuters) - An ex-board member at Nashville-based bank Pinnacle Financial Partners Inc pleaded guilty on Friday to charges that he engaged in insider trading based on confidential information he learned about an impending merger, according to court records.
James Cope, a Tennessee lawyer who resigned from Pinnacle's board in April, pleaded guilty in federal court in Nashville to having engaged in insider trading ahead of the bank's January announcement it would acquire Avenue Financial Holdings Inc.
Under the plea agreement, Cope has agreed to pay a $55,000 fine and serve 24 months of probation, the first nine subject to home confinement. U.S. District Judge Aleta Trauger scheduled sentencing for Nov. 14.
"I've known Jim Cope for 40 years," said Aubrey Harwell, Cope's attorney. "He's a good and decent human being. He made a mistake in judgment, and he is accepting responsibility for it."
According to a plea agreement, Cope, 67, admitted that he began buying Avenue stock after being briefed about the deal during a Jan. 5 executive committee meeting, where members stated they were in favor of the acquisition.
Cope bought additional shares on Jan. 11, charging papers stated. The deal was announced 17 days later, and Cope made $56,000 trading ahead of it, the papers said.
The U.S. Securities and Exchange Commission on Friday filed a related civil lawsuit against Cope, who had been a Pinnacle board member since 2006 and is a partner in the Murfreesboro, Tennessee law firm of Cope, Hudson, Reed & McCreary, PLLC.
Nikki Klemmer, a spokeswoman for Pinnacle, said the company disclosed Cope's conduct and cooperated with the investigation.
"Insider trading of this type is a direct violation of Pinnacle's policies, which we believe are robust," she said in a statement.
The case is U.S. v. Cope, U.S. District Court, Middle District of Tennessee, No. 16-cr-00210.
(Reporting by Nate Raymond in New York; Editing by Cynthia Osterman)
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