A global insider trading ring allegedly made millions trading on information stolen by several investment bankers in the U.S. and the U.K., according to U.S. authorities.
Several traders and investment bankers are facing charges in New York, where indictments were unsealed today alleging that employees at several unnamed banks obtained inside information about public companies and passed that information to traders, who allegedly made tens of millions in illegal profits by trading on that information.
The U.S. attorney’s office for the Southern District of New York unveiled charges today against a couple of London-based bankers, a New York banker, and traders based in both the U.S. and Europe over their alleged participation in the purported insider trading ring.
They are presumed innocent of all charges, including allegations of securities fraud, wire fraud and conspiracy.
According to the indictments, the London-based bankers passed along information about 16 corporate transactions, receiving more than US$1 million in money and gifts for their tips via middlemen.
The traders are accused of providing the cash and gifts to pay off the bankers, and of generating illegal trading profits based on their information.
Three of the accused have been arrested, and the other three remain at large.
“The insider trading charges announced today lay bare a long-running international scheme stretching over the course of years, whose participants earned tens of millions of dollars in illicit profits from illegally trading on stolen inside information,” said Audrey Strauss, U.S. attorney in New York.
“As alleged, the indictments announced today detail very deliberate activity by both current and former investment bankers, securities traders, and even the son of a corporate board member to illegally profit from receiving or providing advanced knowledge of nonpublic information about publicly traded companies,” said FBI assistant director William Sweeney Jr.