Ask any random person on the street about insider trading and they might point to Wall Street corruption or Martha Stewart. But how many know that financial crimes happen at some of the lower levels of the industry, too?
That’s the finding of a federal court in Philadelphia on the actions of a former credit card fraud analyst for Capital One, Reuters reported. In a ruling that mandates Nan Huang to pay $13.5 million in restitution and penalties, the court and the U.S. Securities and Exchange Commission found that Huang had used data kept private by his company to trade in public markets and make approximately $4.4 million in personal profit as a result.
Gregory Morvillo, Huang’s lawyer, told Reuters that the ruling would not be the end of his client’s case.
“Obviously, we’re disappointed, and we disagree with the ruling,” Morvillo said. “We will be considering our options over the coming days.”
The SEC originally filed suit against Huang and a coworker for what it perceived to be evidence of a large number of keyword searches into Capital One’s internal databases. While Huang did not deny that he and a colleague made these searches, he contested to the court that the effect the information could have had on his success in the market was marginal at best compared to the professionally sourced and presented information available to the analyst in the average Wall Street investment firm.
As it stands, Huang has to pay back the $4.4 million he pocketed, as well as a separate penalty worth double those winnings, for a final tally of $13.5 million. Huang’s colleague settled with the SEC in Dec. 2015 for a total sum of $4.7 million. Both employees were fired by Capital One in 2015 and returned to their native China.
Hopefully, back home, no one asks Huang what’s in his wallet; the answer might soon be nothing.
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