Three Caught Trading on Insider Info

September 11, 2017 James Heinsman In the News

A vector render of the iPhone 7 Plus in the flagship Jet Black color. Photo courtesy of Rafael Fernandez.

Two friends from college with aspirations to owning a hedge fund company were caught trying to cash in on Amazon insider info.

Washington state residents Maziar Rezakhani and Sam Sadeghi paid $10,000 to Brett Kennedy, an Amazon analyst, for information about the online retailer’s 2015 first-quarter earnings. The pair of hedge fund wannabes used that information to make $116,000 in profits, boasting beforehand on message boards that he could easily predict what Amazon’s earning were going to be.

“Rezakhani boasted on social media that he could accurately predict Amazon’s financial performance,” said Jina Choi, head of the SEC’s San Francisco office. “But he failed to predict that we would catch him and his accomplices in their illegal scheme.”

Rezakhani, however, is already in jail after he pleaded guilty to a separate scheme to defraud Apple Inc, the IRS, shipping firms and a small bank. The plan involved the purchase of Apple iPhones to resell, which he claimed were lost/stolen while shipped. It was alleged that he concocted the scam to pay or his over-the-top lifestyle. Now he owes his victims $3.5 million in restitution.

Kennedy, the man who sold Amazon’s information, is facing criminal charges. He has already said he would pay more than the $10,000 he made to settle with the SEC without having to admit whether he is guilty or not of committing a crime. Sadeghi also is settling with the SEC, agreeing to a $24,000 penalty without admitting to any wrongdoing.

Amazon, Apple, Brett Kennedy, insider trading, iPhone,

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