A Washington attorney, a Los Angeles attorney and an officer of Bankers Trust Co. of Los Angeles consented yesterday to a court order settling Securities and Exchange Commission charges that they illegally profited from insider information about the pending merger between Brunswick Corp. and Whittaker Corp.
According to the SEC, James D. Hutchinson, a member of the Washington law firm Steptoe and Johnson; Martin W. Cooper, an assistant vice president of Bankers Trust; and Los Angeles attorney William J. Chadwick made a total of $160,000 in profits on stock and call-option contracts that they purchased based on nonpublic information about Whittaker's proposed acquisition of Brunswick.
The three were enjoined from violating antifraud provisions of federal security laws and their offer to pay back profits that the SEC charged resulted from illegal insider trading was accepted. They consented to the court order without admitting or denying the charges.
The SEC said that Cooper purchased stock and call options based on information that he had obtained directly or indirectly from employes or officers of Whittaker. At the time, he served as a loan officer for the company, which was one of Bankers Trust's customers.
The SEC alleged that Cooper provided Chadwick, a personal friend, with insider information and that Chadwick passed the information on to Hutchinson, a close friend. According to the SEC's complaint, Chadwick told Hutchinson that he did not think that he had "inside information."
Chadwick, 34, was a tax lawyer for the Treasury Department in 1974-75 and administrator of the Labor Department's pension and welfare benefit programs in 1976-77. Hutchinson, 38, was a law clerk for Chief Justice Warren Burger, was associate deputy attorney general in the Justice Department in 1975, and also was administrator of the Labor Department's pension programs in 1975-76.