The U.S. Securities and Exchange Commission (SEC) has resolved its enforcement action against a man who engaged in an insider trading scheme that exploited early access to issuers’ regulatory filings.
Last year, the SEC filed a complaint against Justin Chen, alleging that he traded on material, non-public information that he obtained through his employment at a company that provides regulatory filing services to issuers.
In its complaint, the regulator alleged that between January and June 2025, Chen and another employee at the same firm, Jun Zhen, generated more than US$2.2 million in illicit trading profits using their access to issuers’ forthcoming filings on the SEC’s system, known as EDGAR.
Now, the U.S. district court for the Eastern District of New York has entered a final consent judgment against Chen that imposed a permanent injunction and ordered him to pay US$1.85 million in disgorgement, which was deemed to be satisfied by restitution and forfeiture ordered against him in a parallel criminal case.
In July, Chen was sentenced to 27 months in prison and ordered to forfeit US$1.8 million and pay US$115,437 in restitution after pleading guilty to insider trading conspiracy.
Zhen, who also previously pleaded guilty for his role in the scheme, is awaiting sentencing.