A Food and Drug Administration chemist and his son have been charged with an alleged $2.27 million insider trading scheme, announced officials today.
Cheng Yi Liang, 57, and his son, Andrew Liang, 25, both residents of Gaithersburg, Md., were arrested at their residence this morning and made their initial appearances in U.S. District Court in Greenbelt, Md.
The criminal complaint unsealed today in the District of Maryland charges Cheng Yi Liang and Andrew Liang with conspiracy to commit securities and wire fraud, securities fraud and wire fraud relating to their trading in the securities of five companies: Clinical Data Inc., Vanda Pharmaceuticals Inc., Progenics Pharmaceuticals Inc., Middlebrook Pharmaceuticals Inc. and Momenta Pharmaceuticals Inc.
According to the complaint, Cheng Yi Liang, who has been employed as a chemist since 1996 at the FDA’s Office of New Drug Quality Assessment (NDQA), had access to the FDA’s password protected internal tracking system for new drug applications, known as DARRTS. He allegedly used this access to review confidential non-public documents or inside information, relating to whether and when certain drug applications would be approved.
The complaint alleges that from approximately November 2007 through March 2011, Cheng Yi Liang and Andrew Liang profited from the inside information by repeatedly trading in securities issued by companies with pending drug applications, allegedly reaping illicit profits of more than approximately $2.27 million.
The charges reflect a breach of trust by a government employee who had access to confidential information for the purpose of performing his job, said officials.
The case was investigated by the FBI’s Washington Field Office and the Department of Health and Human Services, Office of the Inspector General (HHS-OIG), Office of Investigations, Special Investigations Branch.
Related Federal Cases
- Brian Jorgenson, Insider Trading, Washington 2012 · Washington
- Jonathan Ly, Insider Trading, Washington 2023 · Washington
- Frank T. Poerio Jr., Insider Trading, Pennsylvania 2021 · North Carolina
- Terren Scott Peizer, Insider Trading, California 2021 · Florida
- Angela M. Blythe, Bank Fraud, Maryland 2014 · Washington
Key Facts
- State: Maryland
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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