The Security and Exchange Commission (SEC) Monday filed charges against former US congressman Stephen Buyer for insider trading.
The SEC’s complaint states that when “Buyer left Congress in 2011 and set up a consulting company called the Steve Buyer Group,” in both 2018 and 2019 Buyer used material non-public information from two clients “to trade securities for his own benefit.” Through this material non-public information, Buyer learned of a confidential, planned acquisition between T-Mobile US, Inc. and Sprint Corporation in which T-Mobile planned to acquire Sprint. Before T-Mobile’s acquisition of Sprint became public knowledge, “Buyer spent more than $568,000 to purchase 112,675 shares of Sprint stock.” After the acquisition became public knowledge in April 2018, Buyer acquired ill-gotten gains amounting to approximately $107,987.
In 2019, Buyer used the same tactics to gain an even bigger payout. Buyer learned through material non-public information that Guidehouse LLP planned to acquire Navigant Consulting, Inc. Before the acquisition became public knowledge, “Buyer spent more than $1 million to purchase 46,654 shares of Navigant stock.” After the acquisition became public knowledge in August 2019, Buyer acquired ill-goten gains amounting to approximately $227,742.
In both acquisitions, Buyer owed a duty of confidentiality to the companies not to misuse the information he learned for personal gain. In both acquisitions, according to the SEC, Buyer violated that duty.
Buyer is charged with violating Section 10(b) of the Securities Exchange Act of 1934, which prohibits manipulative and deceptive practices in securities trading. The SEC seeks disgorgement of Buyer’s ill-gotten gains plus interest from both the Sprint and Navigant deals. In addition, the SEC seeks penalties, a permanent injunction and an officer and director bar against Buyer.
Buyer was also one of nine individuals charged with insider trading in a parallel case of four, unrelated insider trading schemes. That case is led by the Department of Justice in the US District Court Southern District of New York.
