Former United HealthCare VP convicted of insider trading
David Phelps
Star Tribune
Published Oct 31 2001
A former vice president at United HealthCare Corp. was
convicted Tuesday on insider trading charges stemming from a
1995 transaction that netted him more than $274,000.
Michael Alan Mooney, 47, of Prior Lake, was found guilty by a
jury in U.S. District Court in Minneapolis on 17 counts related
to his illegal trades.
U.S. District Court Judge James Rosenbaum will sentence
Mooney.
Assistant U.S. Attorney Mike Ward demonstrated to the jury
that Mooney possessed material insider information about a
pending acquisition by Minnetonka-based United HealthCare
when he bought its stock.
The government alleged that Mooney purchased stock options
in United HealthCare, which has since been renamed
UnitedHealth Group, immediately before the company's 1995
purchase of McLean, Va.-based MetraHealth, correctly betting
that United's stock would increase in value upon news of the
transaction.
When word of the deal leaked on June 21, 1995, United's stock
rose $4.50 from $40.74. When the acquisition was officially
announced June 26, the stock was at $46 a share and by
October it had risen to $49.
During the seven-day trial, defense attorney Jon Hopeman
attempted to convince the jury that Mooney based his trades in
United HealthCare on non-material information and a
separate, personal trading strategy.
However, the jury convicted Mooney, who left United in
August 1999, on all charges. He was found guilty on eight
counts of mail fraud, four counts of securities fraud and five
counts of money laundering.
The government's case against Mooney emphasized his access
to strategic corporate decisions through his role as vice
president of underwriting.
-- David Phelps is at dphelps@startribune.com .
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