Kathryn Gannon
NEW YORK - Kathryn Gannon, formerly known as porn star Marylin Star, remains in seclusion in Vancouver. But two former lovers now await their fate in an insider trading scandal which thrust Gannon into a bigger spotlight than she ever knew as an adult entertainment star and brought down one of the heaviest hitters in the Wall Street line-up last year.
Former investment banker James McDermott and industrialist Anthony Pomponio have been on trial in federal court this month. McDermott is accused of tipping Gannon off to pending bank mergers, with Gannon making an alleged $80,000 or better on stock trading based on those tips and passing the same tips on, allegedly, to Pomponio - who also made an alleged $80,000 in similar stock trading.
But the defense argued McDermott was making nothing more than recommendations to Gannon, known to have had little if any experience playing the stock market previously. They also argued he was giving nothing more than the kind of information he might give during his frequent appearances on radio and television shows dealing with banking and the stock market - especially during the height of the 1990s, when banks were caught up in a merger fever. The defense said Gannon and Pomponio weren't doing anything other than trading on stocks well enough profiled as likely takeover prospects.
Closing arguments were made April 24. Prosecutors argued the entire case began June 16, 1997, when McDermott - then running Keefe, Bruyette and Woods, an investment banking firm preparing for its initial public offering - called Gannon, his then-lover, and tipped her off to the first of six prospective bank mergers about which he would tell her. They also argued that Gannon traded through a Charles Schwab account, as the banks in question got ready to merge with larger financial institutions - including such banks as Central Fidelity Banks, Barnett Banks, First Commerce Corp., First Commercial Corp., California State Bank and Advanta Corp. The latter's proposed acquisition by National Australia Bank ended up failing.
McDermott and Pomponio were accompanied by their wives as the closing arguments were made, and each man's romances with Gannon were detailed during the closing arguments. The 30-year-old former porn actress has been a fugitive since her arrest warrant was handed down last December. She's been in seclusion with her fiancé, Michael Gillies, in Vancouver.
Gannon was said to have met Pomponio at a casino table in Atlantic City during an East Coast Video Show. Pomponio also faces a perjury charge for lying to Securities and Exchange Commission investigators during last year's investigation.
