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A former employee with Marvell Technology Group Ltd. (MRVL) has been charged with leaking confidential information about the company to a consultant who then passed it along to hedge funds, according to a court filing by federal prosecutors in Manhattan.
The Marvell employee, Stanley Ng, was arrested in California. He was released on $50,000 bond on Wednesday.
Mr. Ng is the 14th person publicly charged in a wide-ranging government probe, dubbed "Investigation Matchmakers," into alleged insider-trading involving expert-network firms. Of those, 12 have pleaded guilty or been convicted.
He is accused of passing the information to Winifred Jiau, who was convicted at a trial in Manhattan federal court in June of selling information about earnings and profits of Marvell and Nvidia Corp. (NVDA) to hedge-fund employees through a Mountain View, Calif., expert-network company, Primary Global Research LLC.
Ms. Jiau, 43 years old, earned $208,000 over two years working for the expert firm, prosecutors said.
One of the witnesses at her trial, former Nvidia employee Sonny Nguyen, testified that Ms. Jiau had convinced him and Mr. Ng to form an investment club, in which they shared inside information. Mr. Nguyen, who has pleaded guilty to conspiracy to commit securities fraud and wire fraud, testified that he wasn't paid for his information.
Prosecutors said Ms. Jiau gave her sources gifts, which for Mr. Nguyen included live lobsters and an iPhone, and took them to lunch.
Expert-network firms arrange, for a fee, phone calls and meetings between public-company employees freelancing as consultants, and hedge-fund analysts and traders seeking an investing edge. While the consultants are legally permitted to provide general insight, prosecutors say they have often passed along inside information about their employers.