A former scientist at a California-based biotech company agreed to settle SEC insider trading charges.
According to an SEC Complaint filed in the U.S. District Court for the Northern District of California, the Defendant was a scientist who worked on the development of a genetic sequencing platform. The SEC alleges that the Defendant made numerous profitable trades in advance of announcements touting (i) the achievement of certain scientific product milestones and (ii) the product launch. The SEC alleges that the Defendant's trading activity occurred during "blackout periods," in which his company prohibited employees from trading in its stock. The SEC also alleges that the Defendant shared material nonpublic information with a relative, with the intention that the relative benefit from trading on the information. The Defendant allegedly generated over $40,000 through trading on this non-public information.
The Defendant agreed to pay disgorgement of $40,662, prejudgment interest of $4,228, and a penalty of $43,342. He neither admitted nor denied the SEC allegations. The settlement is subject to Court approval.
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