Technology

Ex-JPMorgan Analyst Charged With Insider Trading

The SEC says the illicit trading scheme used confidential JPMorgan information about impending tech mergers to reap more than $672,000 in profits.
Matthew HellerAugust 26, 2015

The U.S. Securities and Exchange Commission has charged a former JPMorgan Securities investment bank analyst with tipping a college friend to two impending tech mergers as part of an insider trading scheme that netted more than $672,000 in profits.

Ashish Aggarwal, 27, learned of the mergers from colleagues at JPMorgan’s San Francisco office, where he worked in the technology, media and communications group, the SEC said in a complaint filed Tuesday. He allegedly passed the information to his friend, Shahriyar Bolandian, who used it to make trades in the shares of the merger targets — PLX Technology and ExactTarget.

Bolandian, 26, and another trader, Kevan Sadigh, have also been charged in the alleged scheme. According to the SEC, Bolandian and his family members made about $453,000 in illict profits, while Sadigh, 28, made about $219,000 for Sadigh.

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Aggarwal and the two traders were arrested Tuesday on parallel criminal charges that were filed in Los Angeles by the Department of Justice.

“We allege that Aggarwal, Bolandian, and Sadigh misused an investment bank’s confidential information for their personal benefit and victimized the bank, its clients, and investors,” Robert A. Cohen, acting co-chief of the SEC Enforcement Division’s market abuse unit, said in a news release.

Aggarwal began working for JPMorgan after graduating from University of California-Berkeley in 2010. As an investment banking analyst, the SEC said, he had access to nonpublic information about the impending acquisition of PLX by Integrated Device Technology.

Bolandian had met Aggarwal at Berkeley and worked at the same company as Sadigh. Acting on Aggarwal’s tip, the SEC said, he and Sadigh made their first purchases of PLXT stock on April 16, 2012. After the PLX deal was announced on April 30, 2012, sending the stock price up 97% in a single day, they allegedly sold all of their shares and options.

The SEC also said Aggarwal learned of ExactTarget’s possible acquisition by salesforce.com before the deal was publicly announced in June 2013 and that Bolandian and Sadigh traded on the nonpublic information he provided them.