Former Ameriprise Financial (AMP) Manager Reema D. Shah, who pleaded guilty to securities fraud earlier this year, will pay $390,103 to settle both the criminal and Securities and Exchange Commission cases against her. Shah, who was a tech stock picker for Ameriprise subsidiary RiverSource Investments, LLC, illegally recommended Yahoo Inc. stock in 2009 after she became privy to nonpublic data about a search engine partnership between the technology company and Microsoft Corp.
According to government officials, Shah traded information between ’04 and ’09 with research analysts, hedge fund managers, and consultants, including Robert W. Kwok, who was the source of the data about Yahoo and Microsoft. Shah previously gave information to Kwok about the company Autodesk and its acquisition of Moldflow Corporation. Kwok went on to buy 1,500 Moldflow shares, allegedly because of the tip, and made a $4,750 profit.
The regulator claims that because of the insider trading information that Kwok gave her, Shah compelled certain funds that she helped manage to buy about $700,000 Yahoo shares. These were later sold at a $388,807 profit.
Shah has since worked with federal agencies to provide information that helped in a number of insider trading probes, including the securities fraud case against SAC Capital Advisors, which led to that firm paying $1.8 million in penalties.
In that case, SAC Capital, now called Point72, pleaded guilty on charges related to insider trading committed by its employees. The hedge fund is no longer managing outside money and now only oversees the funds of its founder Steven Cohen and his employees.
Meantime, Shah, will not see any jail time. She is, however, serving two years probation.
If you suspect that your financial losses are due to securities fraud, contact our law firm today.
SEC settlement ends saga for former Ameriprise exec who aided SAC Capital insider case, Investment News, December 9, 2014
SAC Capital $1.8 billion penalty approved, CNN, April 10, 2014
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