Two GlobeNewswire employees have been arrested and charged with pocketing hundreds of thousands of dollars from information contained in corporate press releases they had access to prior to publication.
• Read also: Fraud: 5 years in prison for the boss of a bogus federation
The Ontario Securities Commission (OSC) revealed on Friday that John Natividad and Harpreet Saini, two men residing in Brampton, a suburb of Toronto, have been charged with fraud and insider trading.
The two computer scientists, who worked as system developers, had access to company press releases before they were officially published.
The two men are accused of taking advantage of this insider information to make gains totaling US$674,154 (approximately C$925,000) for Harpreet Saini and US$280,484 (approximately C$383,000) for John Natividad.
Publicly listed companies usually wait until the end of the trading day to release important information, such as financial results or acquisitions, that might affect their stock price.
By having this information in hand in advance, the two men were able to carry out transactions by anticipating the evolution of the stock market.
“Employees who have access to confidential corporate information have a duty to keep that information safe and not use it for personal gain.
Illegal transactions erode investor confidence,” said OSC Director of Enforcement Jeff Kehoe.
The two men, who are accused of having raged from May 2018 to July 2021, were arrested following information received by the American justice, which also began a civil lawsuit Friday once morest the two men for insider trading on American soil.
John Natividad and Harpreet Saini are due back in court in Canada on November 21.
