U.S. authorities hit former GOP Rep. Stephen Buyer with insider trading charges
Federal authorities filed criminal and civil insider trading charges against former Rep. Stephen Buyer in U.S. court in Manhattan on Monday, alleging that the Indiana Republican used information gleaned from a golf outing with a T-Mobile executive to purchase securities before the company's planned acquisition of Sprint.
Buyer was arrested on Monday, said U.S. Attorney for the Southern District of New York Damian Williams at a press conference.
Buyer, who had been working as a consultant to T-Mobile at the time, learned about the possible megamerger from a company executive while on a work trip to Miami, according to a civil complaint filed by the Securities and Exchange Commission. Despite being warned about the confidential status of the merger, which was ultimately scuttled, Buyer purchased more than $500,000 of Sprint shares, which were then sold shortly after news of the deal went public, the agency alleged.
The former nine-term congressman also allegedly leveraged his role as a consultant to another company, Guidehouse LLP, to purchase shares of Navigant before his client’s acquisition of that business in 2019, according to the complaint.
The SEC's complaint claims that Buyer netted roughly $330,000 from the transactions, which he spread across multiple accounts belonging to associates and family members, as well as an unidentified friend with whom he had allegedly engaged in a romantic relationship.
"When insiders like Buyer — an attorney, a former prosecutor, and a retired Congressman — monetize their access to material, nonpublic information, as alleged in this case, they not only violate the federal securities laws but also undermine public trust and confidence in the fairness of our markets," said Gurbir Grewal, director of the SEC Enforcement Division.
The SEC is seeking disgorgement of the gains allegedly accrued by Buyer and his wife, Joni Buyer, and to block the former congressman from ever serving as an officer or director at a public company.
“Congressman Buyer is innocent," said Buyer's attorney, Andrew Goldstein of Cooley LLP. "His stock trades were lawful. He looks forward to being quickly vindicated."