Manhattan-Based Investment Analyst Charged With Insider Trading

United States Attorney for the Southern District of New York, Jay Clayton, and Assistant Director in Charge of the New York Field Office of the Federal Bureau of Investigation ("FBI"), James C. Barnacle, Jr., announced today the unsealing of an Indictment charging JIANQING LI, a/k/a "JQ," an analyst at an asset manager specializing in biomedical and healthcare investments, with two counts of securities fraud. LI was presented today before Magistrate Judge Gary Stein. The case has been assigned to U.S. District Judge Lorna G. Schofield.

"Jianqing Li allegedly turned confidential information into more than $350,000 in illegal trading profits," said U.S. Attorney Jay Clayton. "Insider trading is unfair and it's illegal. It harms our markets and our investors."

"Jianqing Li's alleged exploitation of sensitive trading information betrayed his employer and established an unfair financial advantage over the unknowing public," said FBI Assistant Director in Charge James C. Barnacle, Jr. "The FBI maintains its steadfast pursuit of those who abuse their positions to generate unlawful profits."

As alleged in the Indictment:

LI made more than $350,000 in illicit profits by trading in stock and options based on material, nonpublic information he misappropriated from the investment fund where he worked. LI was an analyst at a Manhattan-based asset manager specializing in biomedical and healthcare investments, which routinely received nonpublic information from investment banks in connection with its evaluation of investment opportunities in public companies. Rather than honor restrictions on the use of that information, LI repeatedly used inside information to trade securities for his own profit, in violation of his duties to his employer and to the sources of the information. In particular, LI used nonpublic information about upcoming announcements that he expected would increase a company's stock price to purchase securities for his brokerage accounts-or in the case of information he expected to negatively affect the stock price, to sell short-and then unwound his position soon after the public announcement, in each case for a profit. To conceal his trading, LI violated his employer's insider trading policies and code of ethics, including by not seeking preclearance for his illegal trades, not disclosing his trading or profits, and falsely certifying his compliance with those policies annually.

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LI, 40, of New York, New York, is charged with one count of securities fraud under Title 15, which carries a maximum sentence of 20 years in prison; and one count of securities fraud under Title 18, which carries a maximum sentence of 25 years in prison.

The maximum potential sentences in this case are prescribed by Congress and provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Clayton praised the outstanding work of the FBI. Mr. Clayton further thanked the U.S. Securities and Exchange Commission.

This case is being handled by the Office's Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Kyle A. Wirshba is in charge of the prosecution.

The charges contained in the Indictment are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

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   As the introductory phrase signifies, the entirety of the text of the Indictment and the description of the Indictment set forth herein constitutes only allegations and every fact described should be treated as an allegation.