(Bloomberg) -- A San Diego investor on trial for financial fraud told a jury that he used a company account that mixed investors’ money with his own to pay for trips to a strip club and casinos, but denied doing anything illegal.

Donald Blakstad took the witness stand in a Manhattan court and said he used an account for his company -- Midcontinental Petroleum -- for personal and business expenses because there is a lien on his accounts for unpaid taxes. The personal expenses also included the purchase of a Bentley.

Blakstad said he put his own money into the account too, which covered the personal expenses. “I wasn’t using investor money,” he said in response to questions from Assistant U.S. Attorney Edward Imperatore.

Prosecutors claim Blakstad defrauded investors by using their money to cover some of his own personal expenses. During the trial they have painted a picture of Blakstad as a big-spender who frequently hosted group dinners at ritzy San Diego steakhouses and seafood restaurants, picked up a tab for a group trip to New York and bought fancy cars.

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Blakstad is also accused of using inside information from Illumina Inc. employee Martha Patricia Bustos to trade securities around earnings-related announcements.

In a move that’s rare in such trials, Blakstad took the witness stand and spoke directly to the jury, denying the charges.

He said he didn’t trade using material non-public information, and that Bustos, whom he still considers a friend, never gave him specific earnings-related numbers such as revenue or earnings-per-share, which she has testified to doing.

He bought put options on Oct. 10, 2016, hours before Illumina made an earnings pre-announcement that sent the stock price down. Blakstad made more than $2.5 million profit on his trade.

Imperatore asked Blakstad whether he understood that to be a regularly scheduled earnings release or an unscheduled announcement.

“I don’t understand the difference, to be honest with you,” Blakstad responded.

He said there were reports around August 2016 that Thermo Fisher Scientific Inc. might have been looking to buy Illumina for $30 billion, which had sent the San Diego-based biotechnology company’s stock up.

Blakstad said he bought the put options in October, primarily because if an acquisition wasn’t announced, “I felt strongly the stock would go back down.”

Blakstad told the jury he didn’t have a personal bank account because a lien was put on his accounts for unpaid taxes. That’s why, he said, he used the company account for personal expenses. He disputes owing the government money.

Although Blakstad made millions of dollars trading Illumina securities from 2015 to 2019, he didn’t file taxes those years, which he said was a mistake.

“I should have filed a tax return,” Blakstad said, mumbling at times.

The case is U.S. v. Blakstad, 19-cr-00486, U.S. District Court, Southern District of New York (Manhattan).

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