LOS ANGELES
An analyst with J.P. Morgan Securities and two longtime friends were arrested today after being charged in a federal grand jury indictment alleging that they made more than $600,000 in illegal profits, officials said.
Ashish Aggarwal, 27, of San Francisco; Shahriyar Bolandian, 26, of the Palms District in Los Angeles; and Kevan Sadigh, 28, of Encino, are named in an indictment that was unsealed this morning.
If they are convicted of the crimes alleged in the indictment, the three defendants would face up to five years in federal prison for the conspiracy count and 20 years for each of the substantive fraud counts.
Additionally, Bolandian could be sentenced to as much as 10 years in prison if he is convicted of the separate money laundering offense.
Here are the allegations against the trio:
- Between June 2011 and June 2013, Aggarwal was employed by J.P. Morgan Securities, LLC as an investment banking analyst in its San Francisco office.
- Through his employment, Aggarwal allegedly obtained material, non-public (inside) information about upcoming mergers and acquisitions involving publicly-traded companies.
- Aggarwal disclosed inside information to his friend Bolandian, who, in turn, shared the information with his friend Sadigh.
- Bolandian and Sadigh allegedly used the inside information to trade in advance of the public announcements of Integrated Device Technology Inc.’s April 2012 planned acquisition of PLX Technology Inc., and Salesforce.com Inc.’s June 2013 acquisition of ExactTarget Inc.
- Aggarwal, Bolandian and Sadigh allegedly netted more than $600,000 in illicit profits, which the defendants allegedly used to, among other things, cover previous trading losses and to repay liabilities incurred by Aggarwal and Bolandian.
- After being confronted by FBI agents about their trading in early 2015, Bolandian and Sadigh provided false explanations of the basis of their trading decisions.
The indictment charges each defendant with one count of conspiracy to commit securities and tender offer fraud, 13 substantive counts of securities fraud, 13 substantive counts of tender offer fraud and three substantive counts of wire fraud, according to authorities.
Bolandian also is charged with one count of money laundering.
“Every professional with access to inside information has a duty and responsibility to protect that information so no one gains an unfair advantage in the securities markets,” said U.S. Attorney Eileen M. Decker.
Adding, “Insider trading corrodes the integrity of the markets and undermines confidence among those who choose to trade. We will bring to justice anyone who illegally uses or shares confidential business information that can be used to manipulate the system.”
The case was investigated by the FBI and the U.S. Securities and Exchange Commission.