A 42-year-old Houston man is heading to federal prison for his role in a $1.7 million insider trading scheme, announced U.S. Attorney Alamdar S. Hamdani.
Tyler Loudon, 42, of Houston, pleaded guilty on February 22nd to securities fraud charges. U.S. District Judge Sim Lake has ordered Loudon to serve 24 months in federal prison, followed by one year of supervised release. In handing down the sentence, Judge Lake noted that a significant sentence of incarceration was required to reflect the seriousness of the offense, promote respect for the law, and afford adequate deterrence to this type of criminal conduct.
Loudon made $1.7 million in illegal profits from the purchase and sale of stock market shares, using non-public information about an expected acquisition. His wife, an associate manager in mergers and acquisitions at an international oil and gas company, unknowingly provided him with the information. Loudon purchased 46,450 shares ahead of the public notice and then sold them after the announcement, reaping a substantial profit.
“Insider trading is rampant, extremely difficult to uncover and adversely affects the integrity of the financial markets and the public perception of the markets,” said Hamdani. “These types of offenses erode the public’s confidence in the integrity of the markets and lead to widespread cynicism that the markets are rigged in favor of a fortunate few.”
“Mr. Loudon took advantage of his and his wife’s ‘work from home’ situation and betrayed his spouse by eavesdropping on her confidential business calls to realize a profit of $1.7M in less than two months,” said Special Agent in Charge Douglas Williams of the FBI Houston field office. “Insider trading cases like this one cause damage to everyday investors, our economy, and the public’s trust in the fairness of our financial markets.”
Loudon’s wife was not charged in connection with the scheme. Prior to sentencing, Loudon forfeited the $1.7 million in illegal proceeds to the United States. He will self-surrender to a Bureau of Prisons facility to be determined in the near future. The FBI conducted the investigation with the assistance of the Securities and Exchange Commission and the Financial Industry Regulatory Authority. Assistant U.S. Attorney Karen M. Lansden prosecuted the case.
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Key Facts
- State: Texas
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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