A California woman has been arrested on charges of leaking secrets about technology companies to hedge funds, as federal prosecutors expand their probe into insider trading.
Winifred Jiau, 43, was charged with one count of securities fraud and one count of conspiracy, said U.S. Attorney Preet Bharara for the Southern District of New York. Jiau faces up to 20 years in prison on the securities fraud charge.
Her lawyer was not immediately available to comment.
Prosecutors said that from 2006 to 2008, Jiau leaked inside information, including earnings, about multiple publicly traded companies including Marvell Technology Group Ltd and Nvidia Corp to hedge funds, in exchange for more than $200,000 of payments.
They said the payments were made through a Mountain View, California-based “expert network” firm that purported to offer “institutional money managers and analysts with market intelligence” services through a “global advisory team of experts.”
Prosecutors did not identify the firm, but that language is used in marketing materials for Primary Global Research, a Mountain View-based expert network firm.
On Dec. 16, prosecutors disclosed four other insider trading arrests, in an announcement focused on people hired as consultants to hedge funds by Primary Global.
Primary Global, Marvell and Nvidia did not immediately return requests for comment.
In the case of Marvell, prosecutors said Jiau provided two portfolio managers of separate hedge funds with accurate information about the company’s results for the quarter ended May 3, 2008, leading to more than $820,000 of trading profits for one of the funds.
Prosecutors also said Jiau on Aug. 8, 2008 told the portfolio managers that Nvidia would post revenue of “892” for its 2009 fiscal second quarter and announce a stock buyback. A few days later, Nvidia posted revenue of $892.7 million and added $1 billion to the buyback program, prosecutors said.
Jiau was arrested at her Fremont, Calif., home on Tuesday, and is being presented Wednesday before a federal magistrate judge in that state, prosecutors said.
The case is U.S. v. Jiau, U.S. District Court, Southern District of New York, No. 10-mag-02900.
