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Insider Trading Scheme Uncovered in Boston
BOSTON – A staggering case of insider trading has come to light, with two Cambridge-based biopharmaceutical employees convicted of engaging in a scheme that netted them hundreds of thousands of dollars. The employees, identified as Schultz ‘Jason’ Chan, 54, of Newton, and Songjiang Wang, 54, of Westford, were found guilty of conspiracy to commit securities fraud and securities fraud.
According to the evidence presented in court, Chan, the Director of Biostatistics at a Cambridge-based biopharmaceutical company, and Wang, the Director of Statistical Programming at a different biopharmaceutical company, conspired to commit securities fraud between August 2013 and September 2015. They traded on inside information regarding successful clinical drug trials at their respective companies, with Wang trading on information provided by Chan and vice versa.
The scheme, which was facilitated by their friendship, saw Wang trading on inside information Chan provided regarding a clinical study conducted by Chan’s employer. In addition, over a period of several months, Wang tipped Chan off about clinical trial results of a Phase 3 clinical trial being conducted by his employer. The evidence also revealed that Wang gave Chan cash, which Chan used to purchase stock shares of Wang’s employer. Chan subsequently sold those shares and paid back Wang.
The charges against the two defendants carry severe penalties, with the charge of securities fraud providing for a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of $5 million. The charge of conspiracy to commit securities fraud provides for a sentence of no greater than five years in prison, three years of supervised release, and a fine of $250,000 or twice the gross gain or loss, whichever is greater.
U.S. Attorney Andrew E. Lelling and Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Division, made the announcement, with the United States Attorney’s Office receiving valuable assistance from the Securities and Exchange Commission. Assistant U.S. Attorney Jordi de Llano Campos and Assistant United States Attorney Kriss Basil are prosecuting the case, with sentencing scheduled for October 4 and 5, 2018, respectively.
The case serves as a stark reminder of the severity of insider trading and the importance of holding those responsible accountable for their actions. As the investigation and prosecution of such cases continue, it is essential to ensure that those who engage in such activities are brought to justice and face the consequences of their actions.
With the guilty verdicts handed down, the focus now shifts to the sentencing phase, where the defendants will face the music for their roles in the insider trading scheme. As the court weighs the evidence and considers the severity of the penalties, one thing is clear: insider trading will not be tolerated in the halls of power, and those who engage in such activities will be held accountable.
Key Facts
- State: Massachusetts
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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