SEC Halts Alleged Insider Trading Ring Spanning Three Countries
Litigation Release No. 24371 / December 10, 2018
Securities and Exchange Commission v. Rajeshwar R. Gannamaneni, Deepthi Gandra, and Linga R. Gannamaneni, No. 18-CV-11390 (S.D.N.Y. filed December 6, 2018)
The Securities and Exchange Commission has filed insider trading charges against an IT contractor and two others he illegally tipped with confidential client information he stole while working in the Singapore branch of an investment bank.
The SEC obtained a court-ordered freeze of assets in three U.S. brokerage accounts and one U.S. bank account connected to the alleged trading. The SEC's complaint alleges that Rajeshwar Gannamaneni provided nonpublic information about impending mergers, acquisitions, and tender offers to his wife Deepthi Gandra and his father Linga Rao Gannamaneni, who lives in India. Gannamaneni also allegedly traded in an account that he controlled, that was opened in the name of a family member, who was living in the U.S. at the time. According to the allegations in the SEC's complaint, the three collectively reaped approximately $600,000 in profits by trading while in possession of inside information in advance of at least 40 corporate events.
The SEC's complaint charges all three defendants with violating Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder, and charges Rajeshwar Gannamaneni and Linga Gannamaneni with violating Section 14(e) of the Securities and Exchange Act of 1934 and Rule 14e-3 thereunder.
The SEC's continuing investigation was conducted by Polly Hayes and Assunta Vivolo of the Philadelphia Office, with assistance from John Rymas and Pat McCluskey of the Market Abuse Unit's Analysis and Detection Center. The case was supervised by Kelly L. Gibson. Julia C. Green, Karen Klotz, and Jennifer C. Barry will lead the SEC's litigation. The SEC appreciates the assistance of the Financial Industry Regulatory Authority and the Monetary Authority of Singapore.