FBI Agents Arrested Tech Analyst Sandeep Aggarwal For Leaking Non-Public Info To A Former SAC Portfolio Manager
Today, the U.S. Attorney’s Office for the Southern District of New York announced criminal charges against Aggarwal.
He has also been charged by the Securities and Exchange Commission.
Aggarwal, who lives in India and recently returned to the U.S., is accused of tipping off former SAC portfolio manager Richard Lee about a pending deal between Microsoft and Yahoo!.
Last week, U.S. prosecutors said in a federal indictment that Lee pleaded guilty to insider trading charges. U.S. prosecutors said that Lee received non-public information in July 2009 about confidential talks between Yahoo! and Microsoft.
Aggarwal worked as an analyst at Collins Stewart when he was allegedly passing the non-public information along. There were several articles about him from 2009 talking about a possible deal between Microsoft and Yahoo!. (See here, here and here).
He also has been employed with Oppenheimer & Co. and Caris & Co.
Last week, Steve Cohen's $14 billion SAC Capital was indicted by a federal grand jury on criminal charges of insider trading. The hedge fund behemoth was charged with four counts of securities fraud and one count of wire fraud. Defense lawyers for the fund pleaded not guilty.
Here are the Tweets from the FBI.
Here are some more details from the SEC's release:
The SEC alleges that Aggarwal learned confidential details about the significant progress of the Microsoft-Yahoo negotiations from his close friend at Microsoft on July 9, 2009, and he tipped Lee with the information during a telephone call the following day. When the information was reported in the media almost a week later, Yahoo’s stock price rose approximately 4 percent. S.A.C. Capital and Lee reaped substantial profits from the Yahoo shares that he purchased after speaking to Aggarwal.
According to the SEC’s amended complaint filed in federal court in Manhattan, Aggarwal covered both Microsoft and Yahoo for his research firm and regularly received periodic updates from his inside source at Microsoft. Upon learning that Microsoft and Yahoo were potentially within two weeks of finalizing a deal, Aggarwal shared very specific details with Lee. Aggarwal assured him that the information came from a close friend at Microsoft who was reliable and accurate.