Expand / Collapse search
Watch TV
Menu

This material may not be published, broadcast, rewritten, or redistributed. ©2024 FOX News Network, LLC. All rights reserved. Quotes displayed in real-time or delayed by at least 15 minutes. Market data provided by Factset. Powered and implemented by FactSet Digital Solutions. Legal Statement. Mutual Fund and ETF data provided by Refinitiv Lipper.

Google

MIT researcher googled 'insider trading' before committing fraud

By Matthew Humphries PCmag
Published | Updated
stock chart

File photo: A Specialist trader looks at a chart at his post on the floor of the New York Stock Exchange (NYSE) in New York, U.S., May 10, 2017. (REUTERS/Brendan McDermid)

If you know how a company's stock is going to perform on the markets before anyone else, you can get very rich. But you can also be accused and prosecuted for insider trading depending on your actions. In the case of 31-year-old MIT research scientist Fei Yen, his Google searches and subsequent trading led authorities to arrest him.

According to Star-Telegram and Reuters, Fei Yen used information obtained through his wife last year to carry out very profitable trades earning him in the region of $120,000. The trades related to the merger of two companies: Sibanye Gold Ltd. and Stillwater Mining. Yen's wife works for Linklaters, a global law firm involved with the merger.

Yen setup a brokerage account using his mother's name and made several trades in Stillwater stock, all of which were profitable. The SEC flagged the trades as suspicious and traced them back to Yen.

His arrest was made in Massachusetts on Wednesday and he now faces charges of securities fraud and wire fraud. After appearing for a federal hearing in Boston he was released on a $500,000 unsecured bond.

More From PCmag

Interestingly, federal prosecutors looked at Yen's computer activity and discovered Google searches carried out by Yen prior to the merger being made public. Apparently he searched using terms including "how sec detect unusual trade" and "insider trading with international account." They also know he read an article titled "Want to Commit Insider Trading? Here's How Not to Do It."

It just goes to show how your Internet history can work against you as evidence, but in this case the evidence looks clear cut even without the search data. As for Yen's wife, she has not been arrested, but Linklaters confirmed she had been suspended and that it is working with the authorities.

This article originally appeared on PCMag.com.