Goldman Sachs junior banker charged in Insider Trading scheme

The U.S. Securities and Exchange Commission (SEC) has announced charges against an employee of prominent investment bank Goldman Sachs (NYSE:GS) with repeatedly using his access to highly confidential information in order to place illicit and profitable trades in advance of deals on which the bank was providing investment banking advisory services.

Steve Jung insider trading

Steve Jung

According to the SEC’s complaint, Woojae “Steve” Jung, a Vice President of Investment Banking who worked in Goldman’s San Francisco and New York offices, used sensitive client information in order to trade in the securities of 12 different companies prior to the announcement of market-moving events.

The U.S. Attorney’s Office for the Southern District of New York also today unsealed criminal charges against Mr. Jung.

The SEC alleges that between 2015 and 2017, Jung used an account held in the name of a friend living in South Korea to place illegal trades and generate profits of approximately $140,000. As alleged in the complaint, by using his friend’s brokerage account, Jung attempted to evade detection by skirting his employer’s requirements that he pre-clear his trades and that he use an approved brokerage firm that would have reported the trading to his employer.

“Jung tried to insulate himself by allegedly placing trades in the brokerage account of a friend who lived overseas,” said Joseph G. Sansone, Chief of the SEC’s Market Abuse Unit. “Like others before him, Jung’s alleged scheme failed when our data analysis uncovered the account’s suspicious trading pattern and, despite Jung’s attempts at evasion, traced the trading back to him.”

The SEC’s complaint, filed in federal district court in Manhattan, charges Jung with fraud and seeks disgorgement of allegedly ill-gotten gains, pre-judgment interest, penalties, and injunctive relief. The complaint also names Jung’s friend, Sungrok Hwang, as a relief defendant to have him disgorge illicit gains that Jung generated by trading in his brokerage account.

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