A broker-dealer representative and trio of traders exchanged non-public information about follow-on offerings to short stocks to the tune of more than $2.5 million over six years, the Securities and Exchange Commission said.
In turn, two of the traders would buy stock in the follow-on offerings that the broker-dealer was selling in a fraudulent, quid pro quo scheme, the SEC said in its enforcement action against the individuals and their companies in the US District Court for the Eastern District of New York on Wednesday.
The US Department of Justice announced corresponding criminal charges on Wednesday. All four were arrested ...
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