SEC Charges 21 Individuals with Alleged Wide-Reaching Insider Trading Scheme

The Securities and Exchange Commission has charged 21 individuals for their alleged roles in a decade-long insider trading scheme that generated millions in illicit profits by misappropriating confidential information from global law firms [1]. According to the SEC's complaint, filed in the U.S. District Court for the District of Massachusetts, the scheme was orchestrated between 2018 and 2024 by mergers and acquisitions attorney Nicolo Nourafchan and his partner Robert Yadgarov [1]. The complaint alleges Nourafchan misappropriated material nonpublic information from his firm's clients concerning more than twelve pending corporate transactions, which he or Yadgarov then tipped to other participants [1]. Those participants allegedly agreed to kick back a portion of their trading profits or further tip the information [1]. Nourafchan and Yadgarov also allegedly recruited another corporate lawyer who misappropriated information about additional deals [1]. "Today’s action highlights the SEC’s unwavering commitment to uncovering sprawling schemes, like the one alleged here, and holding individuals up and down the tipping chain accountable for their fraudulent conduct," said Joseph G. Sansone, Chief of the SEC's Division of Enforcement’s Market Abuse Unit [1]. The SEC's complaint seeks injunctive relief, disgorgement with interest, and civil penalties for violations of federal securities laws [1]. In a parallel action, the U.S. Attorney’s Office for the District of Massachusetts announced criminal charges against all defendants [1]. The investigation involved assistance from the FBI, FINRA, and multiple international financial regulators [1].