Three Agree to $250,000 Settlement in Insider Trading

WASHINGTON, DC-Three people, including a former company official, have agreed to a $250,000 settlement with the Securities and Exchange Commission in a case alleging insider trading in stock of Nashville-based Corrections Corp. of America. The settlement doesn’t include any admission of guilt.

Agreeing to the settlement, which was filed in the US District Court for the District of Columbia, were former CCA controller W. Blake Brock, his wife Kathy O. Brock, and Kenneth L. Unker, a friend and business associate of Kathy Brock. CCA, which merged with the REIT Prison Realty Trust last October, is the nation’s largest provider of corrections services to governmental agencies, and is involved in the design, construction, ownership, renovation and management of prisons and long-distance inmate transportation services.

According to the SEC, in October 1997 when W. Blake Brock was CCA’s controller, he discovered the company’s quarterly earnings wouldn’t meet expectations. The SEC alleges he tipped off his wife about the earnings shortfall, telling her to buy CCA put options in anticipation of the company’s negative earnings release.