DIGHTON, Mass. (WBZ NewsRadio) — Dighton Police Chief Shawn Cronin was one of four men charged in connection with an insider trading scheme, the United States Attorney’s Office for the Southern District of New York announced Thursday.
Prosecutors claim that Alexion Pharmaceuticals Vice President Joseph Dupont, 44, of Rehoboth, Massachusetts, knowingly told Cronin, 43, confidential details regarding the acquisition of Portola Pharmaceuticals in 2020.
Cronin allegedly shared this information with his two friends Slava "Stanley" Kaplan, 45, of Hopewell Junction, New York, and Jarett Mendoza, who gave Cronin advice on trading strategies; Kaplan then allegedly told his colleague Paul Feldman, 48, of Poughquag, New York, about the acquisition.
Prosecutors further allege that the four men went on to invest in Portola stock before the deal was finalized. Kaplan and Feldman also alerted relatives and friends to the acquisition, leading them to invest in Portola prior to the announcement as well.
When Alexion's acquisition of Portola was announced to the public on May 5, 2020, Portola’s stock price increased more than 130 percent.
According to a complaint filed by the U.S. Securities and Exchange Commission (SEC), the foursome received more than $2.3 million in ill-gotten gains:
- Cronin - $72,000
- Mendoza - $39,000
- Kaplan - $472,000
- Feldman - $1.73 million
Additionally, the friends and relatives Kaplan and Feldman told about the stock made more than $1.7 million in trading profits, the SEC said.
After realizing the extent of their profits, Kaplan reportedly texted Feldman in Russian: “Let’s hope our golden goose will continue laying golden eggs!”
The U.S. Attorney's Office has charged Dupont, Cronin, Kaplan, and Feldman with securities fraud under Title 15 and tender offer fraud. Mendoza was initially charged, but pleaded guilty pursuant to a cooperation agreement.
The SEC has charged Dupont, Cronin, Mendoza, Kaplan and Feldman with violating the antifraud and tender offer provisions of federal securities laws.
The Dighton Board of Selectmen will conduct an emergency meeting Thursday evening to vote on whether to place Cronin on administrative leave and appoint an acting chief of police.
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