The Securities and Exchange Commission today charged five Florida residents with insider trading based on advance knowledge of the acquisition of Pharmasset Inc. by Gilead Sciences Inc. According to the SEC attorneys Robert L. Spallina and Donald R. Tescher and accountant Steven G. Rosen illegally traded on confidential information obtained while acting as advisors to a Pharmasset board member. The advisors purchased Pharmasset securities and then Spallina told Thomas J. Palermo, a financial adviser at a brokerage firm, and Brian H. Markowitz, then Spallina's next-door neighbor, about the impending deal and they also bought shares based on the tips, says the SEC. Pharmasset stock rose by 84 percent on the deal news and the five defendants sold their shares for a profit of $234,000. The five defendants collectively agreed to pay approximately $489,000 for the settlement which is subject to court approval. "Lawyers and accountants occupy special positions of trust and confidence and are required to protect the information entrusted to them by their clients," said Joseph G. Sansone, Co-Chief of the SEC's Market Abuse Unit.
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