Fan Yang and Jing Tian, residents of Indianapolis, have been arrested following an indictment that accuses them of conspiring to commit securities fraud. The charges relate to alleged insider trading based on confidential information about a $3.7 billion corporate acquisition. The announcement was made by U.S. Attorney Jeanine Ferris Pirro.
Yang, who also goes by the name Jocelyn Yang, served as a finance executive at an Indiana manufacturing company where her husband, Tian, was also employed. According to court documents, in 2021 their employer began internal discussions about acquiring a Michigan-based automotive components manufacturer. On February 22, 2022, the Indiana company announced its agreement to acquire the target firm for $36.50 per share—a deal valued at $3.7 billion—which led to a nearly 44% increase in the target company's stock price before markets opened.
The indictment alleges that Yang started gathering material non-public information (MNPI) about the planned acquisition in October 2021 and subsequently discussed securities purchases with Tian beginning in November 2021. Communications between Yang and Tian reportedly took place via Chinese-language messaging apps and included sharing MNPI with others: "We have over 100,000 in there. If the acquisition is completed with 3.5b, we can get a Tesla. Trade in and don’t need a loan haha," Yang allegedly wrote to Tian on WeChat regarding their securities transactions.
Investigators say the group expanded to include at least five additional individuals—among them two Georgetown University graduate students and one trader located in China—who used this inside information to purchase stocks and options contracts related to the targeted company prior to public disclosure of the acquisition.
According to prosecutors, after news of the deal became public, those involved earned hundreds of thousands of dollars in profits from these trades.
"This case is being investigated by the Washington Field Office of the Federal Bureau of Investigation and is being prosecuted by Assistant U.S. Attorney Kevin Rosenberg, Co-Chief of the Fraud, Public Corruption, and Civil Rights Section and Special Assistant United States Attorney Rami Sibay."
An indictment is merely an allegation; all defendants are presumed innocent until proven guilty beyond a reasonable doubt in court.
