2 poker buddies, ex-Nvidia worker cited in insider trading scheme
A former accounting manager for a Santa Clara tech company was accused by federal authorities Wednesday of setting in motion an insider trading scheme that reaped millions of dollars for those involved.
The Securities and Exchange Commission accused Chris Choi, who worked for Nvidia Corp., of passing on confidential information to a friend before the company’s quarterly earnings announcements in 2009 and 2010. That friend then allegedly relayed the tips to a fellow poker player who managed a hedge fund, and who used the information himself and passed it on to analysts at other firms.
According to authorities, Choi’s illegal tips helped the hedge funds avoid losses and reap $16.5 million in illicit profits.
Choi will likely have to pay a $30,000 fine.
The government has come to a settlement agreement with him that would allow him to not admit to the insider trading allegations, pay the penalty and be barred from serving as an officer at a public company for five years.
That settlement will require court approval.
The SEC has previously charged several of the people Choi tipped off, including his friend, the poker player and the firms that benefited.
In a press release, the SEC said Choi is the 45th defendant to be charged in its ongoing investigation into the activities of expert networks.
“The investigation has exposed widespread insider trading by investment professionals, hedge funds, and corporate insiders for illicit profits of approximately $430 million,” according to the release.
A call for comment at Nvidia, which specializes in visual computing technology, was not immediately returned.
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