Blog Posts Tagged With Insider Trading

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SEC v. James E. Hengen (D. Minn. Nov. 8, 2018, Settled)

Action against Defendant, the spouse of a human resources executive, for alleged insider trading.  According to the SEC, Defendant learned material nonpublic information about two pending acquisitions from his wife.  The SEC alleges that Defendant bought stock in each of the target firms while in possession of this information and sold the stock after the acquisition was announced.  The SEC also alleges that Defendant tipped four other individuals, who also traded while in possession of
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SEC v. Slobodan Dragojlovic (C.D. Cal. Nov. 7, 2018, Settled)

Action against Defendant, a software consultant, for alleged insider trading.  According to the SEC, Defendant learned information about a pending acquisition from his brother, an executive at the target firm.  According to the SEC, Defendant bought stock in the target firm while in possession of the material nonpublic information and sold the stock after the announcement of the acquisition.  Defendant has agreed to pay disgorgement of $20,101, prejudgment interest of $1,038, and a civil penalty
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United States v. Sean Stewart (2d Cir. Nov. 5, 2018, Contested)

The Second Circuit reversed the insider trading conviction of Defendant, a former investment banking analyst, on evidentiary grounds.  The government alleged that Defendant, his father, and his father’s friend traded while in possession of material, nonpublic information.  At trial, the United States introduced an incriminating prior statement by Defendant’s father and codefendant.  The court refused to admit an allegedly inconsistent statement made to the FBI for impeachment purposes at trial. The Second Circuit vacated Defendant’s
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SEC v. Hamad A. Ettu (E.D. Pa. Nov. 2, 2018, Contested)

Action against Defendant, an IT professional, for alleged insider trading.  According to the SEC, Defendant learned information about pending acquisitions from his friend, a former investment banker.  The SEC alleges that Defendant bought stock in the target firms while in possession of the material nonpublic information and sold the stock after the acquisitions were announced.  The SEC previously charged the Defendant’s friend and another individual in connection with the scheme.

SEC Press Release

SEC Complaint
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SEC v. Bryan B. Long (N.D. Cal. Sept. 28, 2018, Contested)

Action against Defendant, a former Director of SEC Reporting for an e-commerce company, for alleged insider trading.  The SEC alleges that Defendant acquired material non-public information about a pending acquisition by a subsidiary of his company and purchased call options in the target company while in possession of that information.

SEC Litigation Release
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In re Unal Patel and Amish Patel (A.P. Sept. 28, 2018, Settled)

Action against Respondents, a CPA and a doctor, for allegedly trading while in possession of confidential information regarding an impending acquisition. According to the SEC, Respondent CPA received material nonpublic information from a friend who learned of an acquisition through his employer. The SEC alleges that Respondent CPA shared the confidential information with Respondent doctor, and both Respondents purchased call options in the target company while in possession of the confidential information. Respondent CPA has
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SEC v. Bryan R. Ziegenfuse (E.D. Pa. Sept. 28, 2018, Settled)

Action against Defendant, a former mortgage loan servicing company vice president, for alleged insider trading. The SEC alleges that Defendant learned of his employer’s planned acquisition of another company and received emails regarding the merger prior to the public announcement. According to the SEC, Defendant used a family member’s account to purchase shares and options before the announcement of the acquisition and while in possession of the material nonpublic information. The SEC further alleges that
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In re Thomas Earl Hayden, II, et al. (A.P. Sept. 27, 2018, Settled)

Action against Respondents, a beverage company manager, his father, and a family friend, for allegedly tipping confidential information learned by the manager and trading while in possession of that information. According to the SEC, Respondent manager shared information regarding an impending deal involving his company and another beverage company with his father and family friend. Respondents purchased shares in Respondent manager’s company while in possession of this information. Respondent employee has agreed to pay disgorgement
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In re Gary Bernard Ross (A.P. Sept. 27, 2018, Settled)

Action against Respondent, an investment adviser principal and licensed attorney, for alleged insider trading. According to the SEC, Respondent learned of a forthcoming partnership between two beverage companies from his advisory client and purchased common stock in one of the companies while in possession of the confidential information and prior to the public announcement of the partnership. Respondent has agreed to pay disgorgement of $86,117.82, prejudgment interest of $12,864.41, and a civil penalty of $86,117.82.
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In re Thomas Earl Hayden, II, et al. (A.P. Sept. 27, 2018, Settled)

Action against Defendants, a corporate deal advisor and his wife, for Defendant adviser’s alleged trading in options while in possession of confidential information learned through his employment about upcoming acquisitions of China-based technology companies.  The SEC alleges that Defendant adviser disguised these transactions by trading with an account under his wife’s name.  The SEC has brought charges against Defendant’s wife as a relief defendant.

SEC Litigation Release
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SEC v. Rong Chen, et al. (C.D. Cal. Sept. 10, 2018, Contested)

Action against Defendants, a corporate deal advisor and his wife, for Defendant adviser’s alleged trading in options while in possession of confidential information learned through his employment about upcoming acquisitions of China-based technology companies.  The SEC alleges that Defendant adviser disguised these transactions by trading with an account under his wife’s name.  The SEC has brought charges against Defendant’s wife as a relief defendant.

SEC Litigation Release
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SEC v. Rong Chen, et al. (C.D. Cal. Sept. 10, 2018, Contested)

Action against Defendants, a corporate deal advisor and his wife, for Defendant adviser’s alleged trading in options while in possession of confidential information learned through his employment about upcoming acquisitions of China-based technology companies. The SEC alleges that Defendant adviser disguised these transactions by trading with an account under his wife’s name. The SEC has brought charges against Defendant’s wife as a relief defendant.

SEC Litigation Release
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SEC v. Amer Deeba (N.D. Cal. Aug. 30, 2018, Settled)

Action against Defendant, a former Chief Commercial Officer of a cloud security and services company, for alleged insider trading.  According to the SEC, Defendant gifted his brothers shares in the company and later learned that it had missed its internal sales forecast. The SEC alleges that Defendant informed his brothers of the miss and coordinated the sale of their stock with their brokerage firm.  Defendant has agreed to pay a civil penalty of $581,170.

SEC
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SEC v. Kendricks, et al. (E.D. Pa. Aug. 29, 2018, Contested)

Action against Defendants, a professional athlete and former investment bank analyst, for alleged insider trading.  According to the SEC, Defendant banker shared information regarding upcoming acquisition with Defendant athlete. The SEC alleges that, while in possession of this information, Defendant athlete purchased shares in the companies that were soon to be acquired and sold his positions after the deals were publicly announced.  The SEC further alleges that Defendant athlete rewarded Defendant banker with cash, NFL
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SEC v. Fishoff, et al. (S.D.N.Y. Aug. 23, 2018, Contested)

Action against Defendants, a company, its president and sole owner, a second company controlled by the owner, a healthcare investment consultant and portfolio manager, and an officer at a third company, for alleged involvement in an insider trading scheme.  According to the SEC, Defendant officer tipped Defendant consultant regarding a forthcoming licensing agreement knowing that he was in the business of selling nonpublic information to traders. The SEC alleged that Defendant consultant tipped Defendant owner
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In re James T. Lentz (A.P. Aug. 22, 2018, Settled)

Action against Respondent, a former VP of Sales at a cemetery and funeral home operator, for allegedly benefiting from confidential information obtained through his employer.  The SEC alleges that Respondent learned about a substantial decline in sales that would necessitate a reduction in the company’s distribution payments and subsequently sold all of his shares in the company ahead of the public announcement of the decline.  Respondent has agreed to pay disgorgement of $9,115, prejudgment interest
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In re Ismail Lila (A.P. Aug. 21, 2018, Settled)

Action against Respondent, a former in-house attorney at a corporation providing marine transportation, oil production, storage, and other services to the oil industry, for allegedly trading while in possession of confidential information regarding a strategic business partnership ahead of its public announcement.  Respondent allegedly learned of the partnership through his work at the company and purchased shares of the corporation ahead of its announcement, generating over $28,642 in profit.  Respondent has agreed to pay $28,642
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In re Joseph Jennings, CPA (A.P. Aug. 20, 2018, Settled)

Action against Respondent, a former director at a major accounting and auditing firm, for allegedly trading on the basis of confidential information ahead of the merger of Kraft Foods Group, Inc. and the H.J. Heinz Company.  The SEC alleges that Respondent learned about the merger through his work at the accounting firm and, two days before the merger’s public announcement, purchased 100 Kraft call options in a close relative’s online brokerage account, after which the
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SEC v. A. Catlin Cade, IV (N.D. Al. Aug. 17, 2018, Settled)

Action against Defendant certified public accountant for alleged insider trading.  According to the SEC, Defendant misappropriated material nonpublic information concerning the merger of a potato manufacturer with a snack company.  The SEC alleges that Defendant received the information through his work as an accountant providing tax advice for a private company owned by a member of the potato manufacturer’s board of directors.  Defendant has agreed to settle the charges and to pay disgorgement, prejudgment interest,
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SEC v. Honglan Wang (A.P. Aug. 16, 2018, Settled)

Action against Respondent, a research scientist at a clinical-stage biopharmaceutical company, for allegedly trading while in possession of confidential information regarding the pending announcement of the positive results of one of the company’s drug trials.  The SEC alleges that Respondent learned about the results and subsequently purchased 8,600 shares of the company’s common stock, then selling them immediately after the public announcement.  Respondent has agreed to pay disgorgement of $134,000, prejudgment interest of $3,698.94, and
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SEC v. Christopher Collins, et al. (S.D.N.Y. Aug. 8, 2018, Contested); SEC v. Lauren Zarsky (S.D.N.Y. Aug. 8, 2018, Contested); SEC v. Dorothy Zarsky (S.D.N.Y. Aug. 8, 2018, Settled); In re Lauren Zarsky, CPA (Aug. 15, 2018, Settled)

Action against Defendants, a U.S. congressman, his son, and his son’s girlfriend’s father, for allegedly tipping confidential information learned by the congressman in his capacity as an independent director of an Australian biotech company and trading while in possession of that information.  The SEC alleges that Defendant congressman learned from the biotech company’s CEO that a key drug trial had resulted in clinical failure and that he subsequently shared this information with his son, who
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In re Aaron R. Smith (A.P. Aug 7, 2018, Settled)

Action against Respondent, the son of a bank’s board member, for allegedly trading while in possession of confidential information regarding the bank’s pending acquisition that was shared with him by his father.  The SEC alleges that, upon learning the confidential information, Respondent transferred money into a brokerage account and began purchasing shares of the bank.  Respondent has agreed to pay disgorgement of $40,578.28, prejudgment interest of $3,205.07, and a civil penalty of $40,578.28.

SEC Administrative
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SEC v. Lozuk (S.D. Cal. July 31, 2018, Settled)

Action against Defendant, a former senior vice president of a genomics company, for allegedly tipping a friend regarding a pending acquisition by his company.  According to the SEC, Defendant told his friend about the acquisition at a social event and the friend purchased a total of 18,000 shares before the public announcement of the deal and sold them after the deal became public.  Defendant has agreed to pay a penalty of $26,643.  Separately, his friend
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SEC v. Richard T. Cunniffe (S.D.N.Y. July 25, 2018, Settled)

Action against Defendant, managing director of a registered broker-dealer, in connection with an alleged insider trading scheme.  The SEC alleges the Defendant placed trades on behalf of an investment banker and the investment banker’s father in Defendant’s personal brokerage accounts while in possession of material nonpublic information provided by the investment banker.  The SEC further alleges that the three individuals shared the profits from these trades.  Defendant has agreed to pay disgorgement and prejudgment interest. 
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