Last year, World Fuel put to rest an issue that had been in Miami-Dade courts since 2007. In December, according to World Fuel’s annual report, it settled a dispute with customer Brendan Airways that included a lawsuit with racketeering claims. Brendan operated Pennsylvania-based USA 3000, an airline that provided both scheduled flights and charter service.
Brendan, which sought $4.5 million in damages, claimed it had been overcharged on fuel from 2003 to 2006. The confidential settlement between World Fuel and Brendan did not materially affect the company’s finances, World Fuel said.
Separately, the SEC acted on complaints filed in February 2010 against five South Florida residents, including a World Fuel executive, a former CFO and a securities broker for insider trading on World Fuel stock in 2007.
Named in the complaint was executive Steve Scoppetuolo, who was CFO of World Fuel’s marine division; former CFO Robert Tocci; their securities broker Sarang Ahuja; World Fuel Vice President of Tax Richard White and Eric M. Gordon, a friend of White’s, according to SEC documents.
The complaint alleged that Scoppetuolo tipped his close friend Tocci and broker Ahuja about World Fuel’s worse-than-expected earnings ahead of World Fuel’s May and August 2007 earnings announcements.
In an August 2011 settlement, Scoppetuolo was suspended from appearing or practicing before the SEC as an accountant, barred from serving as an officer or director of a public company and ordered to pay a civil penalty. Scoppetuolo, as well as the other defendants, settled without admitting or denying the allegations, according to Eric Bustillo, SEC regional director in Miami.
The other defendants were ordered to give up profits from the trades and pay civil penalties. In December, broker Ahuja was additionally barred from any association with brokers, dealers, and investment bankers, among others.
The SEC obtained permanent injunctions against all the defendants, according to Bustillo.
The trades were made despite World Fuel policy, which prohibited employees from using non-public information for trading purposes, according to SEC documents.
Neither the insider trading incident nor the Brendan suit had an impact on World Fuel’s financials, Evercore analyst Chappell said. He noted the insider case did not involve the company’s current team.