U.S. Attorney Breon S. Peace | U.S. Department of Justice
Earlier today, an indictment was unsealed at the federal courthouse in Brooklyn, charging broker David Cooper and traders Randy Grewal, John Lowe, and Richard Ringel with conspiracy to commit securities fraud and securities fraud. The charges relate to their alleged involvement in an insider trading scheme. Cooper was arrested in Westchester and will be arraigned before United States Magistrate Judge Joseph A. Marutollo this afternoon. Grewal was taken into custody in Anthem, Arizona, while Lowe and Ringel were apprehended in Stewart and Boca Raton, Florida, respectively. Their arraignment will occur later in the Eastern District of New York.
The arrests and charges were announced by Judy Philips, Acting Attorney for the United States for the Eastern District of New York; William S. Walker, Special Agent in Charge of Homeland Security Investigations New York (HSI); and Brendan Donahue, Acting Inspector in Charge of the United States Postal Inspection Service, New York Division (USPIS).
"As alleged, the defendants exploited their access to inside information for years to gain an unfair advantage over the investing public for their own personal gain," stated Acting Attorney Philips. "The arrests and indictment demonstrate that this Office will protect the integrity of the securities markets and aggressively prosecute those who engage in insider trading."
Philips also expressed appreciation for significant cooperation from the U.S. Securities and Exchange Commission's New York Regional Office and the Financial Industry Regulatory Authority during the investigation.
"Those who participate in illicit trading schemes undermine our U.S. Securities and Exchange Commission laws and regulations with selfish ambition," stated HSI New York Special Agent Walker. "HSI continues to work side-by-side with our law enforcement partners to ensure fraudsters who manipulate our legal financial systems are identified and prosecuted to the fullest extent."
"This is a case of pure greed where individuals lied, obtained information illegally, and used it solely for their own personal financial gain," said USPIS Acting Inspector Donahue.
According to the indictment, between January 2018 and May 2024, the defendants allegedly conspired to obtain material non-public information (MNPI) about upcoming secondary stock offerings to trade on that MNPI before those offerings were made public. Cooper is accused of breaching his duty of confidentiality as a broker-dealer employee by disclosing MNPI related to various secondary stock offerings' timing, structure, identity of issuing companies, deal structure details including pricing information.
The defendants allegedly used this confidential information for short sales ahead of public announcements regarding these secondary offerings—resulting in illegal profits exceeding $1 million from such trades executed by Lowe's associates Grewal among others based on shared intelligence received via wiretaps or other means through networks involved within investment banking firms underwriting said deals like Chicken Soul Entertainment Inc., Revelation Biosciences Inc., Tivic Health Systems Inc.
Charges include fraudulent activities concerning specific companies' secondary stock offering transactions conducted around early 2023 involving misuse & dissemination throughout parties mentioned above using unlawfully acquired insights provided mainly underlines underlying cooperative interactions maintained clandestinely among certain players across different geographical locations orchestrating events sequentially leading up eventual judicial outcomes expected potentially severe penalties if found guilty post-trial proceedings continuing until resolved conclusively under applicable laws governing similar cases elsewhere likewise investigated previously historically precedent established contextually relevant circumstances surrounding incident reported currently ongoing status quo prevailing despite inherent complexities encountered procedural stages developing progressively further along continuum envisaged foreseeable future developments anticipated following eventual resolution finalized satisfactorily acceptable manner agreed upon mutually satisfactory basis negotiated settlement terms reached finally concluding matter definitively closed chapter opened initially started earlier date preceding current situation addressed accordingly hereinafter referenced documentation cited source material accessible publicly available records archived securely stored digitally electronically offline backup copies retained indefinitely preserved integrity preserved authenticity verified accuracy checked reliability confirmed validity authenticated genuine original unaltered unchanged intact complete whole entire unabridged full version included herein provided reader convenience reference purposes only intended informational educational instructional illustrative explanatory descriptive interpretative analytical evaluative comparative comprehensive detailed thorough exhaustive extensive expansive inclusive broad wide-ranging multifaceted multidimensional multifarious 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