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SEC sues Wells Fargo banker and nine others over insider trading

The US Securities and Exchange Commission (SEC) has charged a Wells Fargo investment banker John Femenia and nine others with insider trading and making over $11m in illegal profits by trading on confidential information about impending mergers.

As per the complaint filed in a US court for the Western District of North Carolina, Femenia misused his position at Wells Fargo Securities to obtain material, nonpublic information about four separate mergers.

The information was also leaked to his friends, which led to illegal trading during the period July 2010 to July 2012.

The market watchdog also has charged two firms Coram Real Estate Holdings and GoldStar for their involvement in the insider trading with the banker and group.

In exchange for the secret information, certain members of the group offered a portion of their illicit earnings to Femenia and other defendants, according to the SEC’s complaint.

The SEC has obtained a court order to freeze the assets of the illegal traders.