San Jose men sentenced to prison over securities fraud
SAN FRANCISCO >> Two San Jose men were sentenced Friday to prison after using inside information about a billion-dollar tech company to make money selling securities, U.S. Justice Department officials said.
U.S. District Court Judge Edward Chen handed down respective sentences of 22 months and a year and a day in jail to Nathaniel Brown, 49, and Benjamin Wylam, 42, after separate plea agreements July 14, according to a department statement.
According to the plea agreements, Brown said he began working as a senior revenue manager in 2011 at Infinera, a NASDAQ-traded company then based in Sunnyvale that made networking products and services for telecommunications companies, cloud networks, government agencies and large corporate enterprises.
From April 2016 until his November 2017 termination, Brown admitted to sharing inside information he learned about the company’s financial performance and projections, and Wylam admitted to direct receipt of that information, using it to make stock trades before Infinera quarterly-result announcements that led to gains of just under $1 million.
As part of attempts to conceal the men’s actions, they also admitted to using WhatsApp to communicate, as well as Wylam unfriending Brown on Facebook.
On March 31, Campbell resident Naveen Sood, 49, agreed to plead guilty in what Justice Department officials called a related case, where he admitted to using his own and another person’s brokerage accounts to make trades based on inside information, making about $215,000 in proceeds. Sood’s sentencing is scheduled for December.
After an investigation by the Federal Bureau of Investigations with help from the Securities and Exchange Commission, all three men were initially charged with single counts of securities fraud before their pleas.
In addition, Chen ordered forfeiture money judgments of $999,000 against Wylan and $30,000 against Brown, as well as three-year supervised-release terms after release from prison. Wylam and Brown will each begin serving their terms no later than Jan. 10.