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HomeMarketSEC, DOJ Charge Nuveen Trader in Alleged $47 Million Insider-Trading Scheme

SEC, DOJ Charge Nuveen Trader in Alleged $47 Million Insider-Trading Scheme

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Federal authorities are accusing a trader at asset manager Nuveen and a retired financial professional of conducting an insider-trading scheme that netted them $47 million.

The Securities and Exchange Commission and the Department of Justice have charged Lawrence Billimek and Alan Williams over alleged insider trading.


Al Drago/Bloomberg

Lawrence Billimek, the trader with Nuveen, a unit of TIAA, and Alan Williams are facing civil and criminal charges in the matter, and authorities arrested the men on Wednesday.

“We learned yesterday that one of our employees has been charged with tipping an outsider about our planned trading activities by misappropriating confidential information in direct violation of our policies,” a spokeswoman for Nuveen said in an email. “We immediately placed the employee on leave, suspended his access to all company networks and trading platforms and began our own review, and we are cooperating fully with authorities.”

Court records in the civil and criminal proceedings don’t indicate that the defendants have formally hired attorneys. Billimek and Williams could not immediately be reached for comment.

The feds allege that from September 2016 through August 2022, Billimek was aware of Nuveen’s plans to buy or sell such large quantities of shares “that the trades caused the price of those securities to increase or decrease in a predictable way,” according to the Securities and Exchange Commission’s complaint.

“Billimek advised Williams of these market-moving trades prior to their execution and Williams traded to take advantage of the expected price change,” the SEC said.

Williams placed “over approximately a thousand timely, profitable trades based on the confidential trade information from Billimek, thereby earning tens of millions of dollars in illicit profit,” according to the Justice Department’s indictment.

The DOJ describes Williams as a retired trader who is now an active day trader.

After executing the trades, Williams would send payments to Billimek totaling around $10 million over the course of the alleged scheme, according to the DOJ, which said the two defendants provided “false and misleading information to various financial institutions” about the nature of those payments.

Charging documents describe the two men as having remained in close contact over the course of the alleged scheme, communicating through prepaid burner phones.

In one instance in February of this year, Billimek allegedly tipped off Williams to Nuveen’s plan to make a large purchase of

Vipshop Holdings

(ticker: VIPS). Between around 9:51 and 10:15 the morning of Feb. 24, Williams purchased $1.8 million worth of Vipshop shares, just before the stock shot up after Nuveen’s purchase. Then, between 10:24 and 10:26, Williams sold all his shares, realizing an intraday profit of $55,000, according to the indictment.

The DOJ said that Billimek had been facing “substantial financial troubles” prior to the alleged scheme, citing an email he wrote in August 2016 saying he was “living paycheck to paycheck.”

The SEC is seeking an injunction against the defendants and an order for them to pay disgorgement, interest, and civil penalties.

In the criminal case, Billimek, 51, and Williams, 77, are each facing one charge of conspiracy to commit securities fraud and wire fraud, one count of securities fraud, and one count of wire fraud. Together the charges carry a maximum prison sentence of 45 years.

Write to advisor.editors@barrons.com

Credit: marketwatch.com

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