Former Equifax director jailed for insider trading

[Bubbajim]

What just happened? It may have taken almost two years, but justice has been served to Jun Ying, the former Chief Information Officer of Equifax U.S. Information Solutions, who was sentenced this week for insider trading in the wake of a massive data breach in 2017.

In September 2017, news broke of one of the most significant data breaches a US company had suffered as Equifax made public the news that over 160 million people’s personal information had been stolen. The disclosure saw Equifax’s stock price take a massive hit. But a week before the news broke, then-CIO Jun Ying exercised his stock options, and sold them for almost $1 million, thus avoiding $117,000 in losses he would have incurred otherwise.

While sentencing Mr Ying, U.S. Attorney Byung J. Pak said, “Ying thought of his own financial gain before the millions of people exposed in this data breach even knew they were victims.” Pak continued, “[Ying] abused the trust placed in him and the senior position he held to profit from inside information.”

According to a press release from the Department of Justice, Ying realised in late August 2017 that Equifax had been the victim of a serious breach, and he “conducted web searches on the impact of Experian's 2015 data breach on its stock price.” Seeing that the news had damaged Experian’s stocks, Ying proceeded with the aforementioned sale. The news of the Equifax breach wasn’t made public until September 7 2017, and even then the full extent of the damage wasn't known until May 2018.

Ying has been sentenced to four months in prison, followed by a year of supervised release, and has been ordered to pay $117,117.61 in restitution, as well as a $55,000 fine.

The case was investigated by the FBI. Special Agent Chris Hacker said, “If company insiders don’t follow the rules that govern all investors, they will face the consequences for their actions. Otherwise the public’s trust in the stock market will erode.”

According to the DoJ, Ying is the second person to be convicted following the FBI investigation. Former manager Sudhakar Reddy Bonthu pleaded guilty to insider trading on July 23, 2018.

Permalink to story.

https://www.techspot.com/news/80735-former-equifax-director-jailed-insider-trading.html

 

[VitalyT]

Special Agent Chris Hacker

An FBI agent with name Hacker, really?

 

[gigantor21]

Special Agent Chris Hacker

An FBI agent with name Hacker, really?

Nintendo of America is currently run by a dude named Bowser. It happens.

 

[Bubbajim]

Special Agent Chris Hacker

An FBI agent with name Hacker, really?

I did want to make a joke about it, but I thought I'd leave it to the commentors

 

[Uncle Al]

BRAVO! But the sentence should have been a lot longer .....

 

[captaincranky]

@Bubbajim Four months at a Club Fed low security "prison" camp, many of which have golf courses and tennis courts, is more like an extended summer vacation, than anything remotely resembling, "punishment for criminal behavior".

Minimum Security
Minimum security institutions, also known as Federal Prison Camps (FPCs), typically have dormitory housing, a relatively low staff-to-inmate ratio, and limited or no perimeter fencing. These institutions are work- and program-oriented; and many are located adjacent to larger institutions or on military bases, where inmates help serve the labor needs of the larger institution or base.

OK, so at its worst definition, "a working staycation".

IMO, they should have put the little pr*ck / weasel, in gen pop at a level 3 facility, with all the people whose credit he'd likely helped to ruin over the years.

 

[Bubbajim]

First, spell check is your friend.
Second, why did you feel the need to comment at all then?

Careful there, your level of professionalism is showing..

Apologies for the British-ism in the comment, thank you for pointing out the error. You may not know, but I'm not from round these parts. https://www.collinsdictionary.com/dictionary/english/commentor

On your second point, I've been active in this community for the last 6 years and don't feel the need to erect barriers between myself and other readers, just because I'm now writing a few articles a week. A large part of wanting to contribute to the content on Techspot came from having had so many interesting and entertaining discussions in the comment sections, and I don't think it's unprofessional to continue to have them. If enough feedback suggests I'm wrong about that, then I shall reconsider if needs be.

 

[netman]

Only four months?! Should be 4 years...

 

[j05hh]

Looks like a slap on the wrists when it should have been a slap across the face.

 

[avioza]

In addition whatever proceeds (Calculate based off difference of stock drop the day after the breach was disclosed) he made from the illegal sale should be distributed to other shareholders or reinvested back into the company.

 

[captaincranky]

I think you're being a tad harsh and that is the main reason what there are sentencing guidelines every Judge has to follow.

And I think you haven't read, or simply don't understand the Federal Guidelines in the first place. I've actually read some of them. How about you? Or is it that you simply know they exist, and are making a unilateral decision about how they should be applied?

(Much in they same way you are making decisions for our staff writers, (with no mandate to do so whatsoever), about what their articles should be about, what, or how much editorial content a writer is allowed to interject. There is somebody above @Bubbajim allowed to make these calls, and it isn't you, it's @Julio Franco).

Now, let's get back to the topic of "sentencing guidelines", and your lack of understanding of them.

Martha Stewart avoided losses in the neighborhood of $48,000 by short selling her stock in a company named, "ImClone". ImClone was just doing poorly, it didn't have a data breech which released the personal information of hundreds of millions people "into the wild".

Ms. Stewart served 5 (five) months in federal detention for her crime.

Mr. Ying cut his personal losses by $117,000 (one hundred and seventeen thousand) USD, possibly delaying the notification of Equifax' enormous data breech in the process, which could have opened millions of individuals to identity theft or other financial crimes.

How much time did he get.......? Survey says > 4 months < 1 (one) month less than Martha Stewart.
Which brings us back to the federal sentencing guidelines. These can be enhanced in either direction at the judges discretion. In point of fact, federal court judges sometimes rely on the results and recommendations from the investigations of the probation department. In this case I fear, the presiding judge may be a member of the same private golf club, and Mr. Ying's attorney.

Given your propensity toward advocating leniency toward financial (white collar) crime, it gives me pause to wonder if you're taking notes for personal reasons. (Oh, but I'm just being silly there. You can take it can't ya)?

 

[captaincranky]

I wasn't criticizing the content of the article, I was criticizing the title of said article. There's a difference. Context is important. I was making an objection to the misleading, click-bait type of nature of it's wording.

And again, I'm still very confused about who you think died, and made you editor.

I addition to a limited understanding of federal guidelines, you have a very self involved view on journalism as a whole. Headlines garner subscribers, whether it be in print, on on the web. Headlines need to intrigue and entice a reader.. But you, in some grandiose fantasy of self importance, propose that you know best about what needs to be printed, how it should be worded, and how the article should be titled, so we don't have to listen to you run on about clickbait.

There are reciprocal equations in progress at sites such as Techspot. Those "clickbait articles" finance Techspot, which in turn finances its forums, which in turn gives you a playground in which to run your mouth, railing against its "clickbait". IMO, your interests would be better served with a Twitter account.

I used to subscribe to several magazines. When I came upon an article that didn't interest me, or an ad in which I had no interest, I simply turned the page, as opposed to your tactics, which would likely be to invoke a letter writing campaign, explaining that you knew more than anyone on the staff about journalism, and telling them how to do it correctly.

Several points;
1. Sentencing guidelines have changed since the Stewart case.

But I"m sure that the judge's discretion for enhancing them hasn't.

2. You are comparing two different cases to each other. There are extenuating circumstances in each case the a Judge must consider.
3. Martha's actions were a part of actual involvement with the company in question and she was partly to blame for the poor performance of that company. Mr Ying was not directly involved or responsible for the data breach in question, he only moved to minimize his losses. His crime was a lesser one, even if only just, and therefore his detention time was lesser.
4. Martha's time served was greater, but her fines+restitution were far less than the damages actually caused. Mr Ying's sentence is less, but his fines+restitution are much greater.

If a CEO likes to cash those $1,000,000+ a year paychecks, then the responsibility for everything which happens to and about the company, rests, (or certainly should), upon his shoulders. In this case a company which controls information which affects every borrower on the planet, needed better oversight on its security. Which again, would fall in the supervisory capacity of a CEO.

People are under the impression that CEO's in general, provide massive bullsh!t laden and duplicitous information to the public in the form of press conferences, and then spend the rest of the day snorting coke, banging one of many mistresses, playing golf, and then returning to a very exclusive gated community, plum tuckered out, "from a hard day at the office". In many cases, I'm not so sure that's too far from the truth.

Whatever this clown Ying's "restitution" might be, if I were the AUSA, I'd have rung him up on a RICO statute involving corporate corruption, or at least taken my best shot at it.

In others words, the stock manipulation was merely a "symptom", not the disease itself.

The public is entitled to more transparency about what affects their futures. Because this debacle, is no better than the Obama era, "those banks are too big to fail", let's throw a pile of money at them. But in that case, it affected the uber wealthy losing money whereas we Plebeians, get thrown to the curb, with our pockets turned inside out..

 

[captaincranky]

What, we need permission to offer criticism? I think not.

Na, I'm just highlighting the fact, at least with respect to the news forum, it's pretty much all you do.

You're just picking a fight. Done.

What, not another half page of blather about how "you'\re right", and, "I'm wrong"? What a disappointment you turned out to be.. See ya.