A former Dell supply manager who cooperated with government insider trading investigations, including a probe of a portfolio manager at SAC Capital Advisors, avoided prison on Thursday as a result of his cooperation.
Daniel DeVore, 49, pleaded guilty in 2010 to conspiracy to commit securities fraud and wire fraud for passing confidential information about Dell and its suppliers.
U.S. District Judge Jed Rakoff in Manhattan sentenced DeVore to time served plus two years of supervised release. He imposed no fine but ordered DeVore to forfeit $145,750.
Rakoff noted that many other defendants who provided “vital assistance” and displayed remorse had similarly avoided prison in this and related cases.
“It seems to me all of that applies totally to Mr. DeVore and warrants a sentence not involving incarceration,” Rakoff said.
Prosecutors had backed the reduced sentence, which fell below the 18 to 21 months recommended under federal sentencing guidelines.
DeVore, while he was working at Dell, also moonlighted as a consultant at Primary Global Research, an expert networking firm that became the focus of a wide crackdown by Manhattan prosecutors on insider trading.
Expert networking firms like Primary Global pair industry experts with investors and analysts.
At his guilty plea in December 2010, DeVore admitted that from 2007 through August 2010 he divulged to Primary Global clients confidential information about Dell and two suppliers, Seagate Technology PLC and Western Digital Corp.
Among those who received information from DeVore were two analysts between 2008 and 2009 who went on to share the information with friends, including Jon Horvath, an analyst at Steven A. Cohen’s SAC Capital hedge fund, prosecutors said in a filing on Wednesday.
Horvath has pleaded guilty and is testifying in the trial of SAC Capital portfolio manager Michael Steinberg.
Steinberg, 41, is charged with five counts of securities fraud and conspiracy to commit securities fraud on allegations he traded in Dell and Nvidia Corp in 2008 and 2009 based on inside information.
While DeVore had been listed as a potential witness in Steinberg’s trial, Antonia Apps, the assistant U.S. attorney prosecuting the case, wrote in a court filing on Wednesday that he was now unlikely to be called.
DeVore had previously testified against another Primary Global employee, former sales manager James Fleishman, who was found guilty on conspiracy charges and sentenced to 2-1/2 years in prison in 2011.
DeVore’s own sentence will help close out another of the 76 cases of individuals convicted since October 2009 as part of the wave of insider trading cases prosecutors have pursued in New York.
Those included at least eight former consultants and employees at Primary Global, which filed for Chapter 7 bankruptcy in 2012.
In their filing on Wednesday, prosecutors said DeVore had been helpful in other investigations by the office of Manhattan U.S. Attorney Preet Bharara and the U.S. Securities and Exchange Commission.
Among the ongoing investigations listed was one of Phani Saripella, the former chief operating officer at Primary Global, against whom DeVore “provided incriminating evidence,” the document said.
That portion of the filing was redacted, but the text could be read after it was copied into a word-processing program.
Saripella has not been charged to date. Neither Priya Chaudhry, a lawyer for Saripella, nor representatives for Bharara responded to requests for comment.
The case is U.S. v. DeVore, U.S. District Court for the Southern District of New York, No. 10-01248.