On Wednesday, the U.S. Securities and Exchange Commission announced additional charges in an insider trading case alleging trading on nonpublic information ahead of IBM's acquisition of SPSS.
Amending a Nov. 29 complaint alleging that U.S. retail stock brokers Thomas C. Conradt and David J. Weishaus used insider information about IBM's planned purchase of SPSS as part of an "insider trading scheme that yielded more than $1 million in illicit profits," the SEC this week announced it is now filing charges against the stock analyst who allegedly tipped them to the impending acquisition, stock analyst Trent Martin.
In a press release, the SEC said a lawyer working on the deal spoke to Martin in confidence, seeking "moral support, reassurance, and advice." The SEC alleges Martin "knowingly disregarded insider trading laws to enrich himself," using nonpublic knowledge of the deal to buy $50,000 worth of SPSS stock ahead of IBM's announcement.The SEC says Martin was Conradt's roommate.
Upon learning of the SEC's investigation, Martin fled the country and is living in Hong Kong, according to the SEC. According to The Wall Street Journal, Conradt and Weishaus have pleaded not guilty to insider trading charges.
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