NEW YORK (AP) — Nine people, including a former U.S. congressman from Indiana, tech company executives, a trainee FBI agent and an investment banker, were among those charged Monday in four separate and unrelated insider trading schemes. Charges in New York City.
It was one of law enforcement’s most significant attacks on insider trading in a decade, and a prosecutor and other federal officials pledged renewed vigor for similar cases in the future. They said the fraud resulted in millions of dollars in illegal profits for defendants on both the coasts and Central America.
Stephen Buyer is accused in court documents of engaging in insider trading during the $26.5 billion merger of T-Mobile and Sprint announced in April 2018. One indictment identified him as someone who misused secrets he learned as a consultant to make $350,000 in illegal profits.
Buyer, 63, of Noblesville, Indiana, was arrested in his home state on Monday. As a Republican Congressman from 1993 to 2011, he served on committees with oversight of the telecommunications industry.
He described buying Sprint securities in March 2018, a day after attending a golf outing with a T-Mobile executive who told him about the company’s non-public plan to buy Sprint. Securities and Exchange Commission in federal court in Manhattan.
Navigant Consulting Inc. by Kitehouse, a consulting and advisory firm. Authorities said he was also involved in illegal trade in 2019, prior to his acquisition. The documents say he used his work as a consultant and lobbyist to make illegal profits.
His lawyer, Andrew Goldstein, said in a statement: “Congressman Buyer is innocent. His stock trading was legal. He expects to be vindicated soon.
U.S. Attorney Damian Williams said at a news conference that the cases, in addition to several other recently announced insider trading actions, reflect his commitment to “unrelenting efforts to root out crime in our financial markets.”
“There is zero tolerance, zero tolerance for cheating in our markets,” said Gurbir S., director of the SEC’s Division of Enforcement. Grewal said.
“When the buyer — insiders such as a lawyer, a former prosecutor and a retired congressman — monetize access to material, nonpublic information, as alleged in this case, they not only violate federal security laws, they undermine public trust and confidence in the integrity of our markets,” Grewal said.
In the second indictment, three executives at Silicon Valley technology companies were accused of trading on inside information about corporate connections, one of which he learned from his boss.
One indictment alleges that Amit Bhardwaj, 49, of San Ramon, California, who was Lumentum Holdings Inc.’s chief information security officer, used the secrets to illegally trade and then gave the information to criminal associates, including four friends. The SEC said Bhardwaj and his friends made more than $5.2 million in illegal profits by trading ahead of two company acquisition announcements.
Bhardwaj’s lawyer did not immediately return messages seeking comment.
In the third case, Seth Markin of Washington Crossing, Pennsylvania, a trainee FBI agent — allegedly stole information from his then-girlfriend, who worked at a Washington DC law firm. According to court documents, he and a friend made more than $1.4 million in illegal profits after learning that Merck & Co was going to buy Pandian Therapeutics. It’s unclear who will represent Margin in court.
A fourth indictment charged a New York-based investment banker with sharing secrets about potential mergers with another person, based on the understanding that the pair would share about $280,000 in illegal profits.
Officials said seven of the nine defendants were arrested on Monday and two were arrested earlier.
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