A Pennsylvania attorney faces up to 25 years in prison and a $5.25 million fine for allegedly orchestrating a $79,000 insider trading scheme.

The U.S. Attorney’s Office for the Eastern District of Pennsylvania charged Herbert K. Sudfeld, 64, of Doylestown, Penn., with insider trading and making a false statement. In a parallel case, the U.S. Securities and Exchange Commission also charged Sudfeld with illegally trading the stock of Harleysville Insurance ahead of its 2011 merger with Nationwide Insurance Company.

At the time of the trade, Sudfeld was a real estate partner at a Philadelphia law firm advising Harleysville on the merger. Sudfeld was not involved in the merger, but learned that the announcement of it was imminent from a conversation between an attorney working on the case and their shared legal assistant.

Sudfeld allegedly stole the inside information and purchased Harleysville stock in his and his wife’s accounts on Sept. 28, 2011. The merger was announced the next day, boosting Harleysville’s stock price by approximately 85 percent. Sudfeld sold all the shares he had purchased, realizing approximately $79,000 of illegal profits, the U.S. attorney's office says.

The criminal complaint against Sudfeld alleges that he falsely told FBI agents investigating insider trading that he was not aware of the Harleysville stock transactions until several days to a week later. According to the indictment, Sudfeld also falsely told investigators that he had informed his broker that he could not be involved in the trades due to his position at his law firm, and that he did not discuss Harleysville trades with his broker until after they were completed, which was also false.

The SEC’s complaint names Sudfeld’s wife, Mary Jo Sudfeld, as a relief defendant for the purpose of recovering insider trading profits in her brokerage account through trades conducted by Sudfeld.

If convicted of the criminal charges, Sudfeld faces a maximum sentence of 25 years in prison, a three-year period of supervised release, and a $5.25 million fine. The SEC seeks a permanent injunction and financial penalties against Sudfeld, and the return of any ill-gotten gains with pre-judgment interest from Sudfeld and his wife.