SEC Charges 7 Indian Americans From California With Insider Trading Generating Over $1 Million
- Three of them are software engineers employed at Twilio, Inc., a San Francisco-based cloud computing communications company; while the other four are family members and friends.
The Securities and Exchange Commission has charged seven Indian Americans From California with insider trading. Three of them are software engineers employed at Twilio, Inc., a San Francisco-based cloud computing communications company; while the other four are family members and friends, who allegedly generated more than $1 million in collective profits, according to an SEC press release.
According to the SEC complaint, friends Hari Sure, Lokesh Lagudu and Chotu Pulagam had access to various databases relevant to Twilio’s reporting of revenue. When the trio learned that the company’s customers had increased the usage of their products and services in response to health measures taken in light of the Covid-19 pandemic, they expected to see a rise in the company’s stock price.
The SEC’s complaint alleges that despite receiving a company policy that prohibited them from insider trading, Sure, Lagudu and Chotu Pulagam knowingly tipped off their family and close friends – Dileep Kamujula, Sai Nekkalapudi, Abhishek Dharmapurikar and Chetan Pulagam – to trade Twilio options and stock in advance of its May 6, 2020 earnings announcement. According to the complaint, the scheme generated more than $1 million in illegal trading profits.
The SEC’s complaint, filed in the Northern District of California, charges each of the defendants with violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.
Additional criminal charges against Kamujula were announced by the U.S. Attorney’s Office for the Northern District of California.