The Securities and Exchange Commission has filed insider trading charges against fourteen bankers due to insider trading schemes where Wall Street professionals traded on material, nonpublic information tipped, in exchange for cash kickbacks, by insiders at UBS Securities and Morgan Stanley.
The complaint alleges that in the first scheme, which has been ongoing since 2001, at least eight securities industry professionals, three hedge funds, two broker-dealers and a day-trading firm, made thousands of illegal trades and millions of dollars in illicit profits using inside information misappropriated by a UBS executive to trade ahead of UBS analyst recommendations.
The complaint alleges that in the second scheme, several securities industry professionals and a hedge fund made dozens of illegal trades and hundreds of thousands of dollars in illicit profits using inside information misappropriated by an attorney at Morgan Stanley to trade ahead of corporate acquisition announcements.
Collectively, the complaint alleges, the defendants made at least USD15 million in illicit profits from these two insider trading schemes.