[ by Melanie Gretchen ]

The SEC charged the former CEO of a Denver-based oil-and-gas ("O&G") company for his role in an insider trading scheme.  Prior to the public announcement that Beverly Hills-based private investment firm Tracinda had agreed to purchase a 35% stake in of Delta Petroleum Corp, insider trading boosted its stock value up by almost 20%, the SEC complaint said.  The CEO was charged after the Commission investigated and charged insurance executive Michael Van Gilder for his illegal trading in the case.

Profiles of Defendants.    Michael Van Gilder, 45, of Denver, CO, was CEO and a board member of the Denver-based Van Gilder Insurance Company (“VGIC”) from 2006 through October 2012.  During the relevant period, he and Parker were close friends, and they frequently socialized.

Robert Parker, 51, of  Englewood, CO, was CEO of Delta and Board Chairman from July 2005 until May 2009.  In late 2009, he became the president, CEO and Board Chairman of Recovery Energy, Inc., an independent oil exploration company based in Denver.  He has since resigned from Recovery Energy, Inc.
 

SEC Findings and Allegations.   This case involves alleged insider trading in the securities of Delta Petroleum Corporation (“Delta”) in advance of the 12/31/07 announcement that Tracinda Corporation (“Tracinda”) had agreed to purchase a 35% stake in Delta for $684 million.  Prior to the Tracinda announcement, Parker, then Delta CEO, tipped Van Gilder and at least one other friend  with material nonpublic information concerning Tracinda’s impending investment in Delta.  Using this information, Vab Gilder bought Delta shares and options for his own account, and tipped others to do the same.  After the deal was announced, Delta’s share price jumped almost 20%, enabling Van Gilder and his tippees to generate over $161K in illicit profits. 

Van Gilder also relied on Parker's tip about the company's upcoming Q3 2007 earnings announcement, by purchasing Delta securities.  Here, he made about $4K in illicit profis. All told, the insider trading produced more than $890,000 in illicit profits. 

SEC Sanctions.   For allegedly violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 in the amended complaint.  Going forward, the SEC seeks to disgorge the defendants and their their tippees’ of all illicit gains, recover prejudgment interest, and financial penalties.  The SEC also seeks to prohibit Parker from acting as an officer or director of a public company.