Sat. Jul 13th, 2024

[ad_1]

Federal prosecutors charged a former employee at Goldman Sachs Group Inc. and Blackstone Inc. with securities fraud for allegedly tipping his friends to more than half a dozen deals.

The logo for Goldman Sachs is seen on the trading floor at the New York Stock Exchange (NYSE) in New York City.(Reuters file)
The logo for Goldman Sachs is seen on the trading floor at the New York Stock Exchange (NYSE) in New York City.(Reuters file)

Anthony Viggiano, 26, tipped two friends to deals that Viggiano learned about at his time at the two Wall Street firms, the Justice Department and the Securities and Exchange Commission said Thursday. The charges detail how the group made more than $400,000 on trades passed around on messaging apps like Signal as well as Xbox chat.

ALSO READ: Several Indian-origin persons charged in insider trading cases in US in 2022

“Viggiano betrayed the trust of his employers by tipping his friends,” Damian Williams, the US Attorney for the Southern District of New York, said in a statement. “No matter how evasive insider traders’ conduct, or the lengths gone to hide their offenses, this Office will track down and prosecute those who attempt to cheat the system.”

The latest complaint marks at least the fifth incident involving a Goldman Sachs employee in recent years. Last year, a Goldman banker was accused of passing stock tips to a squash buddy. And that followed a trio of insider trading cases involving Goldman staffers through a span of 18 months ending in October 2019.

Both Goldman and Blackstone said they are cooperating with prosecutors.

“The allegations in the indictment are egregious,” said Mary Athridge, a spokeswoman for Goldman Sachs. “The firm has zero tolerance for this kind of behavior.”

Viggiano worked in the asset and wealth management division, according to the indictment. He had previously resigned from a post at Blackstone, after the firm discovered he had been trading without pre-clearance.

“We make crystal clear to every employee through our extensive compliance and training procedures that we have absolutely zero tolerance for the behavior alleged,” Matt Anderson, a Blackstone spokesman, said in a statement. “This individual was a junior analyst in a non-investment, finance function who was briefly employed for less than seven months and left two years ago.”

His childhood friend, Christopher Salamone, pleaded guilty on Sept. 21 and is cooperating with prosecutors, the Justice Department said. Lawyers for Viggiano and Salamone declined to comment.

Signal, Xbox

The SEC alleged that Viggiano sent tips about deals in 2021 through May 2023 involving companies including, American International Group Inc., Harmony Biosciences Holdings Inc., and CDK Global Inc., to his friends Stephen Forlano and Salamone. Those two allegedly traded on the tips, making hundreds of thousands of dollars in profits.

A lawyer for Forlano said his client denies the allegations.

Viggiano tried to cover his tracks by passing tips to Salamone, asking him to download the encrypted messaging app Signal to communicate and then used the disappearing message feature. He also supplied Salamone with cash for trading, the SEC said.

Salamone made $322,000 from the tips, gave Viggiano $35,000 in cash, and planned to hand over more money, the SEC said. The former Goldman employee had suggested that the illegal trading profits be split 50-50.

The other friend Viggiano tipped — Forlano — not only traded off that information, but also passed it to five friends and family members.

College Buddies

The men all had close relationships dating back years. Viggiano and Salamone are friends dating back 20 years and Salamone’s mother and Viggiano’s father are dating, the SEC said. Forlano went to college with Viggiano and Nathan Bleckley, a US Army captain who is a defendant in the SEC suit, but wasn’t charged by the DOJ.

A lawyer for Bleckley said his client “places a high priority on doing what’s right.”

“We eagerly anticipate closing this chapter of his life and moving on to the next one,” said the lawyer, Todd Spodek.

Salamone confronted Viggiano on a call in June, asking if there was information showing he gave tips to Forlano. Salamone was recording the conversation.

“Nah. Nah,” Viggiano replied. “Because similar to you… Signal, or like XBOX 360 chat, there’s no tracing that. Good luck ever finding that.”

“Exciting news! Hindustan Times is now on WhatsApp Channels Subscribe today by clicking the link and stay updated with the latest news!” Click here!

[ad_2]

Source link