Related Federal Cases
Bank Employee’s Insider Trading Scheme Exposed
DAVID POST, a 42-year-old bank employee from Livingston, New Jersey, has pleaded guilty to insider trading charges in connection with a scheme that earned him over $700,000 in profits. The scheme, which involved trading on material, nonpublic information related to the acquisitions of certain pharmaceutical companies, was uncovered by the FBI and the Securities and Exchange Commission.
According to the indictment, POST received the information from a co-conspirator, identified as CC-1, who worked for a pharmaceutical company. POST then used this information to make profitable trades in the securities of the target companies, selling his positions after the acquisitions were announced publicly and reaping the profits. The indictment alleges that POST gave approximately $57,000 of his illegal proceeds to CC-1 as part of the scheme’s profits.
POST’s insider trading scheme, which ran from at least 2010 through August 2014, involved trading around information related to potential and actual corporate transactions, including acquisitions. The scheme was designed to conceal the communications between POST and CC-1, who used disposable cellphones to discuss the trades.
The U.S. Attorney for the Southern District of New York, Preet Bharara, praised the investigative work of the FBI and thanked the SEC for its assistance in the case. The case is part of the efforts underway by President Obama’s Financial Fraud Enforcement Task Force to investigate and prosecute financial crimes.
POST faces a maximum sentence of five years in prison on the conspiracy count and 20 years in prison on each of the three counts of securities fraud. He also faces a maximum fine of $5,000,000 and agreed to forfeit the proceeds he obtained as a result of the offenses. POST is scheduled to be sentenced by U.S. District Judge Alvin K. Hellerstein on February 6, 2015.
The case highlights the importance of protecting the integrity of the financial markets and holding accountable those who seek to profit from insider information. The FBI and the SEC will continue to work together to investigate and prosecute cases of insider trading and other financial crimes.
Key Facts
- State: New York
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release ↗
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