A former Yahoo executive and a former mutual fund manager for Ameriprise Financial have both pleaded guilty to insider trading charges, according to the US Securities and Exchange Commission.

Court proceedings suggest that former senior director of business management for Yahoo Robert W. Kwok had a chance encounter with former mutual fund and hedge fund manager Reema D. Shah in a hallway during a January 2008 real estate conference. The two allegedly began discussing their respective businesses and kept in contact by phone and in-person meetings.

The SEC says that Shah told Kwok about a pending acquisition between Autodesk and Moldflow. Kwok took that information and purchased 1,500 shares of Moldflow in a personal account less than a month before the deal was publically announced. Shares in Moldflow rose 11 percent after the deal was announced, prompting him to sell for a profit around $5,000.

A year later in July 2009, the favor was returned as Kwok tipped Shah about a pending announcement between Yahoo and Microsoft. Shah allegedly acted on the tip by buying more than 700,000 shares of Yahoo stock using funds she managed which resulted in a payday of $389,000.

Kwok has pleaded guilty to a single count of conspiracy to commit securities fraud. He is facing up to five years in prison, multiple fines and will be barred from serving as an officer or director of a public company.

Shah pleaded guilty to one count of conspiracy to commit securities fraud and one count of securities fraud. For her part, she could serve up to 20 years in prison, owe multiple fines and will be barred from the securities industry.

Shah will face sentencing on Thursday while Kwok will have to wait until September to learn his fate.