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Former Apple Executive Accused Of Insider Trading By SEC: NPR



SEC has accused a former Apple manager of using advance information about the company's finances to sell shares and avoid losses. Here is Apple's inventory numbers on a screen on the Nasdaq MarketSite in Times Square last month in New York City.

Drew Angerer / Getty Images


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Drew Angerer / Getty Images

The SEC has accused a former Apple manager of using advance information about the company's finances to sell shares and avoid losses. Here, Apple's inventory numbers are displayed on a screen at the Nasdaq MarketSite in Times Square, New York City last month.

Drew Angerer / Getty Images

Updated at. 3:30 ET

The US Securities and Exchange Commission says the CEO who was responsible for Apple's insider trading even committed insider trading in 2015 and 2016 – in one case, selling about $ 10 million in Apple stock ahead of time. of a quarterly earnings announcement.

The executive is Gene Levoff, who was until last year Apple's senior director of corporate law and business secretary. According to a complaint filed Wednesday in the US District Court in New Jersey, as head of the company's legal group, Levoff was responsible for ensuring compliance with Apple's insider trading, as well as setting the criteria for employees – including themselves – limited from quarterly revenue announcements.

But the SEC says that in at least three cases in 2015 and 2016, Levoff used inside information about Apple's economy to avoid loss or make money by trading Apple stock:

"For example, in July 2015, Levoff did not materially receive – public economic data showing that Apple would miss analysts' third quarter estimates for iPhone sales. From July 17 and public release of Apple's Quarterly Revenue July 21, Levoff sold about $ 10 million of Apple stock – almost all of its Apple businesses – from His personal brokerage accounts. Apple's stock dropped more than four percent when it published its quarterly financial data. By acting on this material non-public information, Levoff avoided about $ 345,000 in losses. "

The Ministry of Justice also announced that it has charged Levoff with a lot of security fraud. Criminal charges carry a potential penalty of 20 years in prison and a $ 5 million fine.

Levoff, 44, became Apple's senior director of corporate law in 2013, after five years as director of corporate law. He was also the head of the company's Disclosure Committee – where he was willing to be "non-public information on Apple's financial performance" – from September 2008 to July 2018, when he was on leave. He was fired from Apple in September 2018.

The SEC's complaint rightly points to Levoff, and not to Apple, as it says took steps to prevent employees from acting on material non-public information, including non-disclosed financial results: " Apple had an insider trading policy that applied to all employees, and many employees, including Levoff, also received notice when limited trading periods, known as "blackout" periods, were in force. contained a link to insider trading policy. "

According to the complaint, Levoff's role included sending, or monitoring, the transmission of these notification messages to individuals subject to trade restrictions on Apple's quarterly revenues.

In 2015, Levoff also initiated and completed an update to Apple's insider trading.

Apple did not immediately go to NPR's request for comment.

The complaint alleges that Levoff had also committed insider trading on three previous occasions in 2011 and 2012: "In each case, having received an email stating that Apple's pre-earnings release deadline had begun, Levoff purchased thousands of Apple stock stocks before The company released its earnings to the general public, and then sold them shortly after the publication of public quarters
on Apple's quarterly revenues. "

Levoff made about $ 245,000 in profits from these deals, the complaint said.

The SEC wants Levoff to repay the profits and losses avoided due to their alleged actions, which the Commission says amount to about $ 382,000. It also seeks a criminal punishment against Levoff, and to prevent him from serving as an officer or future director of a public company.

Levoff is sued in the US District Court in New Jersey. The data servers that many of the actions were executed are in New Jersey, the SEC says.


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