(Ken Silva, Headline USA) A former official for the Federal Reserve Bank of Richmond pled guilty last week to insider trading, after he was caught misappropriating confidential information to execute trades.
The defendant, Robert Brian Thompson, 43, of Mosley, worked as a bank examiner and senior manager with supervisory duties for the Federal Reserve—giving him access to confidential information about financial institutions under the Fed’s supervision, including confidential supervisory information.
According to the Justice Department, Thompson used confidential information from his workplace to execute 69 trades in seven different publicly traded financial institutions for a total of $771,678 from October 2020 through February 2024.
To conceal the scheme, Thompson lied on his “Form D”—which, among other things, requires employees to disclose if they have any assets, including any equity interest in any banks that are members of the Federal Reserve system.
“Thompson falsely represented on the FRBR’s Form D that he had no assets,” the DOJ said last Tuesday in a press release.
Thompson pled guilty to one count of insider trading and one count of making false statements. He is scheduled to be sentenced on March 19, and faces a maximum penalty of 20 years in prison on the insider trading count—as well as five years in prison on the false statements count.
The Securities and Exchange Commission also filed a complaint against Thompson earlier this month, alleging that he bought $678,000 worth of a bank’s stock hours before the bank was scheduled to make a positive earnings announcement. Thompson’s insider trading netted him roughly $79,346 in ill-gotten profits, according to the SEC.
“The SEC’s complaint further alleges that, in January 2024, Thompson learned that a different bank in his supervisory portfolio would be disclosing unexpected loan losses worth hundreds of millions of dollars as part of an upcoming earnings announcement,” the SEC said earlier this month in a press release.
“Thompson allegedly leveraged that material nonpublic information to buy thousands of options on the bank’s stock two days before the scheduled announcement, which led to $505,527 of ill-gotten profits.”
Thompson has entered a settlement with the SEC in that case, which requires him to disgorge his ill-gotten gains. The settlement is subject to the approval of a judge.
Ken Silva is a staff writer at Headline USA. Follow him at x.com/jd_cashless.
