IT Hacker Settles SEC Charges of Insider Trading
Commentary by Steven Lofchie
A San Francisco-based information technology ("IT") specialist settled insider trading charges with the SEC for hacking senior executives at the online travel company Expedia. According to the SEC Complaint, the IT specialist, who worked in Expedia's corporate IT services department, illegally traded on non-public information in advance of nine company news announcements from 2013 to 2016 and generated nearly $350,000 in profits.
The IT specialist agreed to pay disgorgement of $375,907.02 and is now facing criminal charges brought by the U.S. Attorney's Office for the Western District of Washington.
Commentary
This is one of several insider trading enforcement actions brought recently against IT personnel (see, e.g., SEC Announces Consent Judgment against IT Professional for Insider Trading (with Lofchie Comment). Accordingly, issuers of all types – not just financial firms – need to give consideration as to how to best limit access to confidential information by IT personnel.