Leaking Inside Info
- Aggarwal and his two friends allegedly traded insider information on technology deals
- Illicit profit netted from insider trading at $600,000
- The three surrendered to the FBI on Tuesday SEC has filed parallel civil insider trading charges
A 27-year-old former JPMorgan analyst of Indian-origin, along with his two friends, has been charged in the US with trading on inside information about technology deals, that netted more than $600,000 in illicit profits.
Ashish Aggarwal from San Francisco, and Shahriyar Bolandian 26, and Kevan Sadigh, 28, from Los Angeles have been named in an indictment that charges each of them with one count of conspiracy to commit securities and tender offer fraud, 13 substantive counts of securities fraud, 13 substantive counts of tender offer fraud and three substantive counts of wire fraud.
Aggarwal graduated from the University of California, Berkeley in 2010 with a bachelor’s degree, and from June 2011 to June 2013 worked as an investment banking analyst in the San Francisco office of JPMorgan Securities.
The three surrendered to the FBI on Tuesday and were scheduled to be brought before US Magistrate Judge Patrick Walsh of the Central District of California.
Modus Operandi
According to the indictment, through his employment at JPMorgan, Aggarwal allegedly obtained material, inside information about two JPMorgan-advised deals: Integrated Device Technology’s planned acquisition of PLX Technology in 2012 and salesforce.com’s acquisition of ExactTarget in 2013.
He repeatedly communicated with Bolandian, his friend since college, in the days and weeks leading up to public announcements about the deals.
Bolandian in turn, shared the information with Sadigh, who is also a friend of Bolandian.
Bolandian and Sadigh then allegedly used the inside information to trade in advance of the public announcements of Integrated Device Technology’s April 2012 planned acquisition of PLX Technology and Salesforce.com’s June 2013 acquisition of ExactTarget.
According to the indictment, Aggarwal, Bolandian and Sadigh netted more than $672,000 in combined profits from their insider trading scheme.
They used the profits to cover previous trading losses and to repay liabilities incurred by Aggarwal and Bolandian.
Under The Scanner
Federal regulator Securities and Exchange Commission (SEC) have filed parallel civil insider trading charges against the three.
SEC said Bolandian conducted various trades in his accounts on Aggarwal’s behalf in an arrangement that enabled Aggarwal to circumvent J P Morgan’s pre-clearance rules and potentially to share in any profits.
The SEC’s complaint seeks a final judgement ordering Aggarwal, Bolandian, and Sadigh to pay disgorgement of their ill-gotten gains plus prejudgment interest and penalties, and permanent injunctions from future violations of these provisions of the federal securities laws.
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