Charges filed in high-tech insider trading case
- — 30 December, 2010 09:30
Federal authorities have charged a California woman with securities fraud for allegedly passing detailed financial information on Nvidia and Marvell Technologies to portfolio managers at two hedge funds.
Winifred "Wini" Jiau, 43, of Freemont, California, has been charged with one count of conspiracy to commit securities fraud and one count of securities fraud, according to the U.S. Attorney's office for the Southern District of New York on Wednesday.
Jiau, who was arrested at her home on Tuesday, could face a maximum of 25 years in prison if convicted and more than $5 million in fines.
Jiau worked for Primary Global, a Mountain View, California, market research company. Last month, four employees at Dell, Advanced Micro Devices (AMD), Flextronics International and Taiwan Semiconductor Manufacturing Company (TSMC) were arrested on charges for allegedly pocketed hefty consulting fees for selling the insider data to the research company.
Authorities allege that Jiau traded sensitive information on "multiple companies," including Nvidia and Marvell Technologies. The unsealed court documents has not been posted online yet as of Wednesday afternoon. The hedge funds traded on the information, which was provide by Jiau between 2006 and December 2008.
In two instances on May 23 and May 28, 2008, Jiau called portfolio managers at two separate hedge funds and allegedly provided gross margins and earnings per share for Marvell's quarter that ended on May 3, 2008. The information, which prosecutors say Jiau told the money managers was provided by an internal Marvell employee, was accurate and preceded the company's earning announcement.
One of the hedge funds made $820,000 in profits by trading on Marvell's information, prosecutors said. The hedge funds paid Jiau more than $200,000 during the two-year period that she provided the information.