On 13 June 2022, the U.S. Securities and Exchange Commission (SEC) announced insider trading charges against David Roda, a former software engineer at Penn National Gaming‘s subsidiary Penn Interactive Ventures, in connection with the parent company’s $2 billion acquisition of Toronto-based Score Media and Gaming, Inc. The SEC‘s complaint alleges that, while employed at Penn Interactive, Roda was given confidential information about the planned acquisition to generate more than a half-million-dollar in unlawful profits.
In breach of his duties, David Roda purchased 500 out-of-the-money call options on Score Media in the weeks and days leading up to the announcement of the acquisition. Additionally, Roda tipped his longtime friend, Andrew Larkin, also charged by the SEC, who then purchased 375 Score Media shares. Score Media‘s stock price increased nearly 80 percent after Penn National and Score Media publicly announced their deal. Roda and Larkin sold their holdings for unlawful profits of $560,762 and $5,602, respectively.
The SEC‘s complaint charges Roda and Larkin with violating the securities laws’ antifraud provisions. David Roda has agreed to be permanently enjoined from violating those provisions and has agreed to pay disgorgement, prejudgment interest, and a civil penalty to be determined by the Court at a later date. Without admitting or denying the allegations in the SEC‘s complaint, Andrew Larkin has agreed to be permanently enjoined from violating the securities laws’ antifraud provisions and to pay more than $11,000 in disgorgement and penalties. The settlements are subject to Court approval.
In a parallel action, the U.S. Attorney’s Office for the Eastern District of Pennsylvania announced criminal charges against David Roda.
