The Pennsylvania pastor arrested Tuesday for allegedly pocketing profits of $17.5 million using illegal inside information won’t be tending his flock this Sunday — because he’s in jail.
A rare legal smackdown between federal judges resulted late Tuesday in the freezing of the bail order freeing the pastor, Vitaly Korchevsky, head of the Slavic Evangelical Baptist Church in Brookhaven, Pa.
A Brooklyn federal judge overturned a Philadelphia magistrate judge’s order that would have freed the pastor on a $100,000 bond.
Magistrate Judge Linda Caracappa agreed to the bond bail after the pastor’s wife told her Korchevsky’s travel abroad was part of his religious duties. But before the bond could be posted, Judge Brian Cogan of Brooklyn stayed her order.
Korchevsky will remain in custody until at least next week, after a bail hearing in Brooklyn.
Korchevsky, a key suspect in a $100 million international insider-trading ring with strong ties to alleged hackers in Kiev, Ukraine, is a flight risk, prosecutors said.
The pastor is one of nine facing criminal charges. Five are in custody and four remain at large outside the US.
While not preaching, Korchevsky formed an “unholy alliance” with hackers who stole 150,000 corporate earnings reports before they were made public, according to the allegations.
The pastor ran some his trades through brokerage accounts for a hedge fund, NTS Capital, launched by him and his wife, Svetlana, in 2011, prosecutors said. Korchevsky had been pastor at the church since at least 2010, according to a report.
The alleged insider trader has a long, active history in finance — although it appears to have tapered off after the financial crash of 2008.
Right before then, he worked for asset managers Investment Counselors of Maryland and Old Mass Mutual, public records show.
Korchevsky was registered as an investment adviser with the Securities and Exchange Commission from 2005 to 2009. Authorities said his illegal trading appears to have begun around the time he launched the NTS hedge fund in 2011 — soon after joining the church.
One of the first trades the feds suspected occurred on Aug. 3, 2011.
The hackers intercepted a press release for a now-bankrupt biotech company called Dendreon 27 minutes before it was released to the public, court documents reveal. In that short time, Korchevsky bought 1,100 put options that earned him a profit of $2.3 million, prosecutors said.
A few months later, $400,000 from his brokerage account was used to buy real estate in nearby Glen Mills, Pa., according to allegations. Late in 2011, the rest of the money was used to buy more real estate, documents said.
After Korchevsky’s arrest, the government executed seizure warrants on 10 pieces of property he owns as well as $5.4 million in bank and brokerage accounts.