United States Department of Justice Charged 8 Individuals (Include 1 ex-Merrill Lynch Banker, 2 Singapore Citizens & 3 Hong Kong Citizens) in Global Insider Trading Network (> $10 Million Profit) for Securities Fraud & Money Laundering
20th November | Hong Kong
The United States Department of Justice (DOJ) has charged 8 individuals (Include 1 ex-Merrill Lynch banker, 2 Singapore citizens & 3 Hong Kong citizens) in global insider trading network (> $10 million profit) for securities fraud & money laundering. Announcement (18/1/25): “ A superseding indictment was unsealed today bringing securities fraud and money laundering charges against eight foreign nationals who are alleged members of a global insider trading network, including several leaders of the network: 1) Samy Fadi Khouadja, 45, of France and the United Arab Emirates (ex-Merrill Lynch); 2) Eamma Safi, a/k/a “TT,” a/k/a “Yummy,” a/k/a “Situatie Packered,” a/k/a “Roman Kna,” 38, of the United Arab Emirates and Germany; 3) Zhi Ge, a/k/a “Josh Ge,” a/k/a “Josh Gez,” a/k/a “Jay Gat,” 34, of Singapore; 4) Christophe Dong, 41, of France; 5) Julien Liu, 35, of France and Hong Kong; 6) Patrick Chou, 38, of France and Hong Kong; 7) Cheuk Yue Lee, a/k/a “Ryan,” a/k/a “m100,” 43, of Hong Kong; and 8) Dev Ananth Durai, a/k/a “Devah,” 39, of Singapore. Safi and Ge were charged by criminal complaint in April 2024 and indicted by a federal grand jury in Boston in July 2024. The superseding indictment charges all eight defendants with two counts of conspiracy to commit securities fraud, two counts of securities fraud, and one count of money laundering conspiracy. Safi is in U.S. custody, and Ge was provisionally arrested in Singapore on July 3, 2024, and remains in extradition proceedings. The remaining defendants are considered fugitives. As alleged in the charging documents, which included information obtained from cooperating witnesses, Khouadja, Safi and Ge were leaders of an insider trading network from 2016 to 2024. As part of the scheme, Khouadja, Safi and Ge allegedly recruited investment bankers and other corporate insiders who had access to material, non-public information (MNPI) about the financial performance and merger-and-acquisition activity of publicly traded companies. As alleged, Khouadja, Safi and Ge then obtained MNPI from those insiders, including by paying the insiders for the information. Thereafter, Khouadja, Safi and Ge allegedly traded on the basis of the MNPI and recruited a network of traders, in the United States, Europe, the Middle East and Asia, to trade on it. The defendants allegedly leaked MNPI to journalists and news outlets to profit on securities trades following the publication of the information. Many of the illegal trades allegedly took place over an automated exchange operated in Massachusetts. It is further alleged that the network of traders, which included Dong, Liu, Chou, Lee and Durai, traded on the basis of the MNPI in exchange for their agreement to kick back a percentage of illicit profits to leaders of the network, through payments designed to conceal the nature of the proceeds, including cash transfers, third-party payments and the use of shell companies and sham loans and invoices. As alleged, the defendants and other co-conspirators who were members of the network traded on MNPI in advance of more than a dozen corporate transactions and announcements, generating tens of millions of dollars in illicit profits. The defendants and other co-conspirators who were members of the network allegedly took various steps to conceal the scheme from law enforcement and regulators, including the use of burner or disposable cell phones, coded language, in-person meetings and various encrypted communications channels. Specifically, the defendants and other co-conspirators allegedly relied heavily on encrypted mobile messaging applications, featuring disappearing or auto-deleting messages, which they believed were beyond the reach of law enforcement … … For example, it is alleged that Durai messaged a co-conspirator trader that Liu was a “purely insider trading guy,” and that “the deal I made with the guy who gives me the tip [Liu] is that I give him 50% of profit…so you can buy and help me subsidize my payment to him.” In another message, Liu allegedly told Durai that Khouadja provided MNPI that was “only [a] 100% thing.” In another message, Khouadja allegedly told Dong to tell a co-conspirator trader that “the source wants 50, so for you, me and the source, you can tell him 200. He will give me the code [stock ticker] only if the guy [trader] is ok,” and thereafter, Khouadja told Dong to tell the trader that the deal “could be anytile [sic, anytime] | they are already drafting SPA [stock purchase agreement].” Khouadja also allegedly messaged Dong, “US deal 50c premium imminent…can he do it,” which Dong then forwarded to traders, including Chou and Durai. As another example, Safi allegedly provided MNPI to Ge to relay to Lee, and Safi said: “Is like [Lee] asking me in order to take our trade we should let him speak with the insider | I am his assurance,” and if “[Lee] wants the formal way let him go to a financial advisor.” It is further alleged that after Chou profitably traded on MNPI obtained from Dong, Dong sent Chou a phony invoice for dresses to substantiate a kick-back payment of illicit securities fraud proceeds from Chou to Dong … … The charge of conspiracy to commit securities fraud provides for a sentence of up to 25 years in prison, five years of supervised release and a fine of $250,000 or twice the gross gain or loss, whichever is greater. The charge of securities fraud provides for a sentence of up to 25 years in prison, five years of supervised release and a fine of $5 million. The superseding indictment charges each defendant with one count of money laundering conspiracy, which provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $500,000 or twice the value of the property involved, whichever is greater. The superseding indictment charges Safi and Ge with one count of money laundering, which provides for a sentence of up to 20 years in prison, three years of supervised release and a fine of $500,000, or twice the value of the property involved, whichever is greater. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and statutes which govern the determination of a sentence in a criminal case. U.S. Attorney Foley and FBI SAC Docks made the announcement today. Valuable assistance was provided by the U.S. Securities & Exchange Commission and the Financial Industry Regulatory Authority. The Justice Department’s Office of International Affairs worked with the Government of Switzerland to secure the arrest and February 26, 2025 extradition from Switzerland of Safi. Assistant United States Attorney Ian J. Stearns of the Securities, Financial & Cyber Fraud Unit is prosecuting the case. The details contained in the charging document are allegations. The defendants are presumed innocent unless and until proven guilty beyond a reasonable doubt in a court of law.
“ United States Department of Justice Charged 8 Individuals (Include 1 ex-Merrill Lynch Banker, 2 Singapore Citizens & 3 Hong Kong Citizens) in Global Insider Trading Network (> $10 Million Profit) for Securities Fraud & Money Laundering “
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United States Department of Justice Charged 8 Individuals (Include 1 ex-Merrill Lynch Banker, 2 Singapore Citizens & 3 Hong Kong Citizens) in Global Insider Trading Network (> $10 Million Profit) for Securities Fraud & Money Laundering
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