Massachusetts Police Officer Among 3 Charged With Insider Trading In Kickback Scheme
A Needham police officer and another Needham resident are facing insider trading charges after federal prosecutors said they swapped confidential information on a Norwood company’s business dealings as part of a kickback scheme.
The officer, David Forte, 58, learned in 2016 from a close relative and executive at Analog Devices in Norwood about the company’s plans to acquire a California technology firm, according to the office of United States Attorney Rachael Rollins.
Forte then tipped off two friends — Gregory Manning, 59, of Needham, and John Younis, 59, of Bristol, Rhode Island — about the impending deal, according to prosecutors.
Manning and Younis, along with one of Younis’ business associates, were then able to purchase stocks and call options that would benefit if the deal went though. The group later paid a kickback to Forte for his information, authorities said.
Forte, Manning and Younis are each facing a charge of conspiracy to commit securities fraud following their arrests Wednesday, Rollins’ office said. They will appear in a Boston federal court Wednesday afternoon.
After Forte told Manning and Younis about the pending deal between Analog Devices and Linear Technology Corp., the California technology company, the pair bought shares of Linear in anticipation of the purchase. Younis also bought call options, a bet that the price of a stock will increase, and then told his business partner about the coming deal, officials said.
When the purchase was finalized, Manning, Younis and Younis’ associate sold their shares at profit, prosecutors said.