A federal judge sentenced a former agent for the Federal Bureau of Investigation to three years probation yesterday for obstruction of justice related to the insider-trading prosecution of a stock picker.
The former agent, Lynn Wingate, was also sentenced to 550 hours of community service and fined $2,500 in Brooklyn federal court, said Bob Nardoza, a spokesman for Roslynn R. Mauskopf, the United States attorney in Brooklyn. Prosecutors had asked Judge Raymond J. Dearie of the United States District Court to impose a 10- to 16-month prison term on Ms. Wingate, who pleaded guilty to making unauthorized computer searches on behalf of the stock picker, Anthony Elgindy, and an accomplice, court papers said.
On June 13, Judge Dearie sentenced Mr. Elgindy to 11 years and three months in prison for using inside information to make short sales and extort money from companies he criticized in an online newsletter. He was convicted last year of racketeering conspiracy, securities fraud, wire fraud and extortion.
Mr. Elgindy used information supplied by Jeffrey A. Royer, then an F.B.I. agent, to spread negative publicity about companies through his Web site. When Mr. Royer left the bureau in 2002 to work with Mr. Elgindy, he instructed Ms. Wingate, whom he had been dating, to run his and Mr. Elgindy’s names in an F.B.I. database, according to court papers.
Michael Schneider, a federal public defender in New York who represents Ms. Wingate, did not return a call made to his office after business hours yesterday.
Short-sellers seek to profit by correctly predicting a decline in a stock’s price. They sell borrowed shares, planning to buy them later at a lower price and return them to holders. Mr. Elgindy’s gains from trading shares of 32 companies using illegally leaked information totaled $3.02 million, and he made another $1.61 million in Web site fees, the government said.
Mr. Royer and Mr. Elgindy, both 38, were acquitted of 17 other charges. Mr. Royer is free on bail until his sentencing, scheduled for July 28. Mr. Elgindy’s lawyer said his client would appeal.