SEC Charges Tipper of Confidential Information to SAC Capital's Lee

The SEC amended its insider trading complaint against Richard Lee to include sell-side analyst Sandeep Aggarwal and also announced that the Department of Justice would pursue criminal charges against Aggarwal. According to the SEC's complaint, Aggarwal shared confidential information regarding the 2009 Microsoft-Yahoo search engine partnership negotiations which he used to tip-off Lee. Lee then purchased large amounts of Yahoo stock for an SAC fund he managed and his personal trading account, both of which reaped substantial profits after the Yahoo stock rose 4 percent nearly a week later when the news was publicly reported. Both Lee and Aggarwal are charged with violating Section 10(b) ("Manipulative and Deceptive Devices") of the Securities Exchange Act of 1934 and Rule 10b-5 ("Employment of Manipulative and Deceptive Devices").

See: SEC Litigation Release.