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Insider Trader Sentenced to 27 Months in Prison
BOSTON – A California-based biopharmaceutical company executive was sentenced to 27 months in prison for insider trading, making nearly $1 million in the process.
Robert Gadimian, 48, of Burbank, Calif., was sentenced by U.S. District Court Judge William G. Young to 27 months in prison, two years of supervised release and ordered to pay a fine of $25,000. In November 2017, Gadimian pleaded guilty to seven counts of securities fraud and insider trading.
Gadimian worked at Puma Technology Inc., a biopharmaceutical company in California that focused on developing a breast cancer drug called neratinib. He was the Senior Director of Regulatory Affairs from November 2011 to October 2014 and gained access to sensitive, non-public information about ongoing drug trials.
He used this information to trade on the stock market, making profits of $95,000 in 2013 and $1,060,000 in 2014. For example, in July 2014, he purchased a series of short-term Puma call options in advance of a public announcement that Puma achieved positive results during one of the trials. The following day, Puma’s stock price jumped approximately 295 percent, and Gadimian then sold all the call options he purchased and profited $910,000 from his illegal trades.
United States Attorney Andrew E. Lelling and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, announced the case. The U.S. Securities and Exchange Commission provided assistance in bringing this case. Assistant U.S. Attorney Neil J. Gallagher Jr. of Lelling’s Economic Crimes Unit prosecuted the case.
Gadimian’s actions were a clear violation of Puma’s insider trading policy and the law. His sentence serves as a reminder that insider trading will not be tolerated and those who engage in it will be held accountable.
The case is a reminder of the importance of maintaining the integrity of the stock market and the trust of investors. It is a victory for the U.S. government and a warning to anyone who would seek to exploit their position for personal gain.
Key Facts
- State: Massachusetts
- Category: White Collar Crime|Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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