The Securities and Exchange Commission has charged a vice president of investment banking at Goldman Sachs with insider trading.
The SEC said Woojae Jung, who worked in the bank’s San Francisco and New York offices, repeatedly used his access to confidential client information to place illegal trades ahead of deals for which the bank was providing investment banking advisory services.
The SEC said Jung made profits of $140,000 on illegal stocks and options trades placed between 2015 and 2017, using an account held in the name of a friend living in South Korea. Jung used the friend’s brokerage account to evade Goldman’s requirement that he pre-clear trades, according to the SEC.
The complaint was filed in federal district court in Manhattan. The U.S. Attorney’s Office for the Southern District of New York unsealed criminal charges against Jung on Thursday as well.
Joseph Sansone, chief of the SEC’s market abuse unit, said the SEC’s data analysis uncovered suspicious trading patterns and traced the trading back to Jung.
The complaint seeks disgorgement of allegedly ill-gotten gains, pre-judgment interest, penalties, and injunctive relief. It also names Jung’s friend, Sungrok Hwang, as a relief defendant to have him disgorge illicit gains.
Jung has worked for Goldman since 2012, according to Financial Industry Regulatory Authority broker records. A spokesperson for the bank said, “We are aware of the situation regarding Mr. Jung and are cooperating with legal authorities in the matter.”
He allegedly used sensitive client information to trade ahead of market-moving events on the securities of 12 companies, including W.R. Grace, SanDisk, KLA-Tencor, Fairchild Semiconductor, FEI, NXP Semiconductors, Microsemi, Gigamon, and WebMD Health.
In the instance of SanDisk, for example, Jung allegedly bought shares and call options in the company in the autumn of 2015 when he learned it was having nonpublic discussions about being acquired by Western Digital. After the deal was announced, Jung sold the options and shares for $40,000 in profits.