Law concept - Law book with a wooden judges gavel on table in a courtroom or law enforcement office

A couple of software engineers are facing insider trading charges in both Canada and the U.S., based on allegations that they traded on forthcoming corporate news, which they accessed through their jobs at a newswire service.

The Ontario Securities Commission (OSC) announced that the pair, John Natividad and Harpreet Saini, both of Brampton, Ont., have been charged with fraud and insider trading offences, based on the OSC’s allegations that they accessed corporate press releases before they were published, and traded on that information.

At the same time, the U.S. Securities and Exchange Commission (SEC) also filed civil fraud charges against the pair, citing the same facts.

According to the SEC, Saini and Natividad, who worked at Intrado Corp., which operates the GlobeNewswire service, traded in advance of hundreds of market-moving announcements between 2018 and 2021.

The SEC alleged that their trading, which mostly occurred on U.S. exchanges, made over US$1.5 million in illicit profits.

The allegations have not been proven in either case.

The pair are set to appear in a Brampton, Ont. court on Nov. 21 to answer the OSC’s charges.

“Employees who have access to confidential corporate information have a duty to safeguard that information and not misuse it for their personal benefit,” said Jeff Kehoe, director of enforcement at the OSC, in a release.

“Illegal insider trading erodes investor confidence in our markets, and the OSC will continue to use all its tools to root out this type of misconduct and pursue bad actors,” he added.

“As alleged in our complaint, Saini and Natividad engaged in an insider trading scheme, which spanned several years, to enrich themselves at the expense of others, and brazenly bragged about it via text message with each another,” said Michele Wein Layne, regional director of the SEC’s Los Angeles office.