The Securities and Exchange Commission (SEC) on Monday charged former Representative Stephen Bayer (R-Ind.) with insider trading, including buying shares based on nonpublic information.
The Securities and Exchange Commission has filed a charge of insider trading in Manhattan federal district court, accusing the buyer of illegal stock purchases in at least two cases, according to an agency news release. The SEC is seeking to compel the buyer to dispose of profits made from the alleged schemes.
The charges were brought as part of an investigation with the buyer and nine other defendants, who were also charged Monday with the insider trading schemes.
The US Attorney’s Office for the Southern District of New York on Monday filed criminal charges in a parallel case against nine defendants, including the buyer.
Those who invest in non-public information are not only violating federal law, but “undermining public trust and confidence in the fairness of our markets,” said Gurbert Grewal, director of enforcement at the SEC.
“We are committed to doing everything in our power to maintain and enhance public confidence by leveling the playing field and holding the buyer accountable for illegally profiting from their access,” Grewal said in a statement.
Buyer, who served in Congress from 1993 to 2011, founded his own consulting group called the Steve Buyer Group shortly after leaving public office.
The former congressman was accused of obtaining $568,000 in Sprint stock after learning through non-public channels in March 2018 that T-Mobile was planning a merger with the then rival carrier. T-Mobile was a customer of Steve Buyer Group.
The SEC said the buyer immediately received more than $107,000 via the exchange after news of the merger was leaked in April 2018.
In another case, the Securities and Exchange Commission says the buyer bought more than $1 million in stock in Navigant Consulting before announcing that one of its clients, Guidehouse LLP, would buy the company.
He allegedly spread the stock purchases across several accounts, including accounts belonging to his wife and son.
The buyer then sold his shares for a profit of $227,000 on the day the Guidehouse-Navigent merger was announced, and the Securities and Exchange Commission charged for it.
At a news conference on Monday, the US Attorney’s Office for the Southern District of New York announced that criminal charges against the buyer and eight other defendants, including a former FBI intern and investment banker, were part of a broader effort to combat financial fraud. .
At the press conference, US Attorney Damian Williams said he took office last year “to be relentless in rooting out corruption in our financial markets.”
“About a year later, those priorities haven’t changed a bit,” Williams said.