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Ex-Goldman Sachs employee pleads guilty to insider trading

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By Reuters

By Brendan Pierson

NEWYORK (Reuters) – A former Goldman Sachs Group Inc <GS.N> employee pleaded guilty on Wednesday to engaging in insider trading based on non-public information about several companies that were clients of the investment bank, Manhattan federal prosecutors announced.

Woojae “Steve” Jung, who was a vice president with the bank in San Francisco, has agreed to forfeit $130,000 he made through the illegal trades, according to a statement from the office of U.S. Attorney Geoffrey Berman.

As part of a plea deal, Jung and prosecutors have agreed to a prison sentence of 18 to 24 months under federal sentencing guidelines. Civil claims against him from the U.S. Securities and Exchange Commission remain pending.

Patrick Smith, a lawyer for Jung, declined to comment on the plea. A Goldman Sachs spokesman said Jung had been terminated shortly after his arrest in May.

Prosecutors said Jung, 37, conducted his trades through a brokerage account in the name of a friend living in South Korea. The brokerage account was accessed from internet addresses that were traced to Jung, according to the SEC.

Prosecutors accused Jung of illegally trading ahead of announcements or reports of deals involving W.R. Grace & Co <GRA.N>, Foresight Energy LP’s <FELP.N>, Western Digital Corp <WDC.O> and other companies.

Authorities said Jung’s scheme began in early 2015 and continued until the middle of 2017, when the SEC sought information from Goldman about which employees had access to confidential information about certain transactions.

Following that request, according to prosecutors, someone called the brokerage firm whose account was used to make the illegal trades.

Using the name of Jung’s friend in Korea, the caller said the account had been opened using stolen personal information, and that he was concerned about the transactions in the account, prosecutors said.

(Reporting By Brendan Pierson in New York; Editing by David Gregorio)