Insider trading rap for ex-Merrill broker

A former Bank of America Merrill Lynch broker has pleaded guilty to helping a client, a former corporate executive, trade stocks illegally, based on inside information, Assistant U.S. Attorney Eric J. Beste of the Southern District of California said last Wednesday.

Gary Yin, a 54-year-old San Diego resident, pleaded guilty last Tuesday to creating a secret Merrill brokerage account so that Jing Wang, an executive vice president and president of global business operations at Qualcomm Inc., could engage in insider trading in his company’s shares and those of an acquisition target, officials said.

Mr. Yin made his plea on criminal conspiracy charges in an appearance before U.S. Magistrate Judge Nita Stormes of California’s Southern District, Justice Department officials said. He still faces civil charges brought by the Securities and Exchange Commission.

CONCEALED EVIDENCE

Mr. Yin purchased shares of Qualcomm for Mr. Wang after the executive learned that the company planned to increase its quarterly dividend and implement a stock repurchase program in 2010, authorities said. When Mr. Wang learned that year that Qualcomm was considering purchasing Atheros Communications Inc., officials said he asked Mr. Yin to purchase shares of Atheros, as well.

According to the indictment, Mr. Yin then helped Mr. Wang conceal evidence of the insider trading scheme by setting up a shell company in the British Virgin Islands and moving illicit trading profits into the shell company’s brokerage account. Authorities said Mr. Yin took account documents to Mr. Wang’s brother in China and arranged to mislead investigators.

Mr. Yin made more than $27,000 from the insider trading scheme, while Mr. Wang made nearly $250,000, according to the SEC.

Both Mr. Yin’s lawyer and Mr. Wang’s lawyer declined to comment.

Neither Qualcomm nor Merrill Lynch have been implicated in any wrongdoing.

Related Topics: Securities and Exchange Commission