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Fri April 12, 2013
Ex-KPMG Partner Accused Of Insider Trading
Originally published on Fri April 12, 2013 10:55 am
DAVID GREENE, HOST:
In Los Angeles, a former partner at KPMG, one of the big four accounting firms, has been charged with insider trading.
As NPR's Nina Gregory reports, Scott London is accused of trading tips for money and gifts.
NINA GREGORY, BYLINE: The details in the Justice Department's criminal complaint against Scott London read like bad fiction. Bags of hundred dollar bills wrapped in $10,000 bundles, a Rolex worth an estimated twelve-thousand dollars, secrets shared at the country club and covert recordings of phone calls.
As KPMG's lead auditor for clients including, Herbalife and Skechers, London had access to detailed corporate financial information the public did not. He allegedly passed tips to his friend, Bryan Shaw, who in turn, made over $1.2 million trading stocks. In return, London got the bags of cash and the watch.
ANDRE BIROTEE: These are very serious allegations.
GREGORY: Andre Birotte is the U.S. attorney for the Central District of California.
BIROTEE: He was entrusted to obtain and keep information secret, and not to disclose it. I mean an auditor acts as a gatekeeper, if you will, and he broke that trust for his benefit.
GREGORY: London's lawyer said he plans to plead guilty. He could face up to five years in prison and a $250,000 fine. No charges have been filed yet against London's friend, Bryan Shaw.
Nina Gregory, NPR News. Transcript provided by NPR, Copyright NPR.