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A former stockbroker made nearly $23,000 on a pending acquisition by a Silicon Valley company after using insider knowledge he learned from his girlfriend, an attorney involved in the deal, prosecutors said Tuesday. Lee Edelman, 34, was indicted on securities fraud charges after his girlfriend, an associate at a large Manhattan law firm, told him in March 2004 that Applied Materials Inc. was in talks to acquire Metron Technology NV. Applied Materials, based in Santa Clara, Calif., builds semiconductor-making equipment, while Metron provides support services for the industry. Metron’s share price almost doubled on Aug. 16, 2004, when the deal was announced. Edelman, of New York, quickly sold his shares, making $22,786, according to the indictment in U.S. District Court in Manhattan. The Securities and Exchange Commission, which filed civil insider trading charges against Edelman, said in a release that Edelman broke up with his girlfriend several weeks after he began buying Metron stock. The attorney was not identified in court papers and was not aware of Edelman’s stock buys, investigators said. Edelman, reached by telephone at home Tuesday, said he did nothing wrong. “I’m innocent, and I’m going to fight it to the end,” he said. “She never gave me any information whatsoever.” An initial court appearance had not been scheduled. Edelman faces up to 20 years in prison, if convicted. According to the complaint, Edelman and his girlfriend had a history of sharing confidential work and personal information and that the girlfriend trusted and expected Edelman to keep information about her clients confidential. In March 2004, the woman disclosed the names of the companies involved in the transaction to Edelman and told him he must keep them confidential. Three months later, Edelman accompanied her to collect six boxes of documents related to the acquisition, the SEC said. For the next several weeks, she reviewed documents, talked with colleagues and clients and did other work related to the deal on weekends and evenings with Edelman present, the SEC said. Edelman allegedly bought 12,000 shares between July 1, 2004, and Aug. 13, 2004. Copyright 2006 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.

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