FOR IMMEDIATE RELEASE
Owner And Principal Of Investment Fund Sentenced To Three Years In Prison For Insider Trading And Investment Fraud
According to the Indictment, evidence presented at trial, and statements made in connection with sentencing:
BLAKSTAD was a stock trader and the owner and principal of an investment fund known as
On several occasions, from 2016 through 2018, BLAKSTAD obtained inside information about Illumina's financial condition from Bustos before Illumina publicly announced its earnings and financial results. As BLAKSTAD knew, Bustos owed a duty to keep inside information about Illumina confidential.
BLAKSTAD, aware of Bustos's breach of duty to Illumina, used this inside information to make profitable trades in Illumina securities shortly before Illumina's earnings announcements. At times, BLAKSTAD tipped his associates so that they could trade Illumina stock and options based on the inside information. At other times, in order to avoid detection, BLAKSTAD arranged for his associates to purchase Illumina securities for BLAKSTAD's benefit in accounts controlled by his associates.
Following the public announcement of Illumina's earnings, BLAKSTAD and his associates sold the Illumina securities at a significant profit, sometimes exceeding more than 2,000 percent. In total, BLAKSTAD and his associates made more than
In addition, from at least in or about 2015 through at least in or about 2019, BLAKSTAD devised and operated a securities offering fraud to fraudulently obtain more than a
To facilitate the scheme, BLAKSTAD made false and misleading representations to investor victims regarding how their investment funds would be utilized. During the scheme, at BLAKSTAD's direction, victims transmitted their funds, including by wire transfer, into bank accounts that were controlled by BLAKSTAD. Once he obtained these investor funds, BLAKSTAD did not use them for the purposes he had represented to investors. Instead, BLAKSTAD diverted a substantial portion of victims' funds to himself and to co-conspirators. For example, BLAKSTAD used the funds to pay for a variety of personal expenses and for purposes that were unrelated to the business of Midcontinental Petroleum.
BLAKSTAD also made a series of false and misleading statements to victims designed to avoid detection, perpetuate the scheme, and keep the victim funds he received as a result of the fraud.
In total, BLAKSTAD's schemes yielded more than
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In addition to his prison term, BLAKSTAD, 62, of
This case is being handled by the Office's Securities and Commodities Fraud Unit. Assistant
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