The former congressman from Indiana reportedly made over $100,000 as a result of non-public information he learned about the US telecoms merger
This week, the US Securities and Exchange Commission (SEC) has filed charges against former US congressman Stephen Buyer for insider trading related to the merger of T-Mobile and Sprint.
The SEC alleges that Buyer leveraged his position as a T-Mobile consultant to gain non-public knowledge about the upcoming T-Mobile acquisition of Sprint, which he then used to make thousands of dollars by purchasing Sprint securities on the stock market.
The filing claims that in March 2018, before the merger was formally announced, Buyer played golf with an unnamed T-Mobile executive, whereby he learned of the merger plans. The next day, Buyer purchased 112,675 Sprint shares across four brokerage accounts for $568,000.
One month later, T-Mobile’s intention to purchase Sprint was leaked to the media, sending the latter’s share price soaring.
As a result, the SEC suggests that Buyer immediately made over $107,000 in profit.
Buyer is also accused of purchasing more than $1 million-worth of shares in Navigant Consulting, Inc. in 2019, ahead of the announcement that the company would be acquired by another of Buyer’s consulting clients, Guidehouse LLP.
This time, following the deals official announcement, Buyer immediately sold his shares for more than $227,000 in profit.
“When insiders like Buyer – an attorney, a former prosecutor, and a retired Congressman – monetize their access to material, nonpublic information, as alleged in this case, they not only violate the federal securities laws, but also undermine public trust and confidence in the fairness of our markets," said Gurbir S. Grewal, Director of the SEC Enforcement Division. "We are committed to doing all we can to maintain and enhance public trust by leveling the playing field and holding Buyer accountable for illegally profiting from his access."
Buyer maintains his innocence, with his lawyer saying that the purchases were legitimate and that Buyer "looks forward to being quickly vindicated”.
The SEC charged Buyer alongside eight other individuals across four separate cases of insider trading, a move described as “one of the most significant attacks by law enforcement on insider trading in a decade”.
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