(August 3 – 16:00 ET) – Reuters is reporting that James McDermott Jr., the former CEO of investment bank Keefe Bruyette & Woods, was sentenced to eight months in prison today after his conviction for fraud and conspiracy in an insider trading case. He also received a US$25,000 fine and 300 hours of community service.

McDermott was convicted in April for supplying stock tips to his mistress, Kathryn Gannon, 31, a former porn star who now lives in Vancouver. The tips involved impending bank takeovers for which Keefe Bruyette was an advisor. Gannon allegedly passed the trading tips on to Anthony Pomponio, a New Jersey businessman, and the pair made more than US$170,000 in trading profits from the tips.

Gannon turned herself in to the RCMP in Vancouver, but remains free on bail and is fighting extradition to the U.S. Her extradition trial isn’t scheduled until next March. Pomponio was convicted of securities fraud and perjury in April.
-IE Staff