By Dan Whitcomb
LOS ANGELES (Reuters) - A former analyst with J.P. Morgan Securities
The three men, who surrendered to the FBI on Tuesday morning, are accused of netting illegal profits by trading in advance of two acquisitions, in 2012 and 2013, that had not been announced publicly.
Ashish Aggarwal, 27, Shahriyar Bolandian, 26, and Kevan Sadigh, 28, were each charged in the indictment, which was handed down in U.S. District Court in Los Angeles, with multiple counts of securities fraud.
Aggarwal was working in J.P. Morgan's offices in San Francisco at the time of the offences, according to the court papers.
"Insider trading corrodes the integrity of the markets and undermines confidence among those who choose to trade," U.S. Attorney Eileen Decker said in a written statement released through her office.
"We will bring to justice anyone who illegally uses or shares confidential business information that can be used to manipulate the system," Decker said.
Aggarwal is accused of obtaining inside information about Integrated Device Technology's planned acquisition of PLX Technology Inc., and Salesforce.com Inc.'s June 2013 acquisition of ExactTarget Inc. and tipping off Bolandian.
Bolandian is accused of sharing that information with Sadigh.
Each defendant was charged with one count of conspiracy to commit securities and tender offer fraud, 13 counts of securities fraud, 13 counts of tender offer fraud and three counts of wire fraud. Bolandian also is charged with a single count of money laundering.
All three men were expected to make court appearances later on Tuesday.
"Mr. Aggarwal denies the charges against him. He has retained Goodwin Procter to represent him in this matter and intends to vigorously defend himself against these allegations," attorney Grant Fondo said in a written statement.
Lawyers for Bolandian and Sadigh could not immediately be reached for comment.
If convicted at trial, each defendant faces up to five years in prison for the conspiracy count and 20 years behind bars for each of the substantive fraud counts, said Thom Mrozek, a spokesman for the U.S. Attorney's Office in Los Angeles.
Bolandian could be sentenced to up to 10 years in prison if he is found guilty of the money laundering offence, Mrozek said.
The U.S. Securities and Exchange Commission filed a related civil lawsuit against the three men on Tuesday as well.
(Reporting by Lindsay Dunsmuir and Dan Whitcomb; Editing by Sandra Maler)
