Former Amazon Employee Charged with $1.4m Insider Trading Scheme
A former Amazon finance manager and two family members have been charged with insider trading, after the former allegedly misused tax details she was privy to as part of her job.
The Securities and Exchange Commission (SEC) levied the charges on Monday, clarifying that they related to Amazon earnings announcements between January 2016 and July 2018.
As a senior manager in Amazon’s tax department, Laksha Bohra prepared and reviewed calculations used to finalize details presented in the firm’s quarterly and annual earnings, according to the regulator.
It is alleged that, from January 2016 to July 2018, Bohra tipped off her husband Viky Bohra with confidential information on Amazon earnings. He is then said to have traded on this information with his father Gotham, using 11 accounts managed by various members of the family.
The SEC also alleged that Laksha Bohra ignored quarterly reminders from Amazon that sharing non-public information or recommending the purchase or sale of Amazon securities is illegal.
The family is alleged to have made $1.4m from its insider dealings.
“We allege that the Bohras repeatedly and systematically used Amazon’s confidential information for their own gain,” said Erin Schneider, director of the SEC’s San Francisco Regional Office. “Employees with access to confidential, potentially market-moving corporate information may not use that information to enrich themselves, their friends, or their families.”
According to the regulator, the three have agreed to pay back the $1.4m, plus $118,406 in “total prejudgment interest,” and total penalties of over $1.1m.
Incidents of this sort are still not uncommon, and are often perpetrated by those who already receive generous salaries from their employer.
In October 2018, a former Equifax software manager was sentenced to eight months home confinement after pleading guilty to insider trading, while in December last year it was the turn of a former IT administrator at Palo Alto Networks, who is said to have made $7m in a three-year conspiracy.