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Designer sunglass company founder to plead guilty to insider trading scheme -Breaking


© Reuters.

Nate Raymond

BOSTON, (Reuters) – The founder of a brand name designer eyewear business whose family held leadership positions in major retailers such as Target and Wal-Mart. DSW Inc He has agreed to plead guilty for insider trading in Florida with two men using information that he received from his cousin.

On Thursday, federal prosecutors in Boston revealed in court documents that David Schottenstein agreed to plead guilty and help in prosecution of an entrepreneur and founder of venture capital firms.

A lawyer for Schottenstein, the founder of designer sunglasses company Privè Revaux, did not respond to requests for comment.

Prosecutors claim that Schottenstein (38) traded information from inside information he obtained from a cousin who sits on the boards at DSW, a shoe retailer, and a cannabis products company. Green Growth Brands (OTC:) (GGB).

Schottenstein was trading ahead of a DSW 2017 earnings announcement; 2018 news about Albertsons Companies and Rite Aid merging (NYSE:) Corp); and a GGB tender offer for Canadian cannabis-related business Aphria(NASDAQ:) Inc (2018), prosecutors claimed.

An investment consortium was formed by the cousins’ family businesses, and they were involved in Rite Aid transactions that later went bankrupt.

Schottenstein’s trades were worth more than $600,000. According to the U.S. Securities and Exchange Commission, this was in connection with a lawsuit.

According to Prosecutors, Schottenstein illegally gave tips to two of his friends: Kris Bortnovsky who cofounded Sakal Capital Management and Ryan Shapiro who created JPay, an inmate money transfer company. This was the unexpected news.

Officials claimed that Bortnovsky’s had traded prior to all three announcements, and Shapiro was based on tip about Rite Aide and Aphria.

Bortnovsky was charged with making more than $4 million, while Shapiro was accused of illegally taking $121,000. Both were first charged in April and officially indicted Thursday.

Bortnovsky’s attorney James Froccaro said that he was innocent. Martin Weinberg was Shapiro’s attorney and stated that he is “factually as well legally innocent of all the current allegations”.

DSW now belongs to Designer Brands (NYSE 🙂 Inc. GGB declared bankruptcy after its unsuccessful bid for Aphria in 2020.

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