July 03, 2023: The compliance chief at a Chinese payment processor was charged by the U.S. Securities and Exchange Commission and New York federal prosecutors with violating insider trading laws after sneaking onto his girlfriend’s computer to view meetings between investment bankers and companies.
Steven Teixeira, chief compliance officer for the U.S. arm of China’s LianLian Global, pleaded guilty to the federal charges under a cooperation agreement. The SEC charges remain outstanding, the agency said Thursday.
Teixeira allegedly obtained insider information, including advanced understanding of Broadcom’s announced $61 billion acquisition of VMware in 2022, and shared it with an associate for profit. The SEC says Teixeira got the information from his girlfriend’s Outlook calendars and files, who was hired as an executive assistant at an unnamed New York-based investment bank.
The nonpublic information included term sheet data and deal planning by many technology organizations, including the VMware deal and Thoma Bravo’s planned purchase of Proofpoint, allegedly allowing Teixeira to collect more than $730,000 in profit.
Teixeira’s girlfriend, who was not named in the complaint, asked him “to check her work email while she was away during the workday and to alert her if she received emails that required her attention.”
Proofpoint was taken private in 2021 by private equity firm Thoma Bravo in a $12.3 billion deal, within the timeframe Teixeira was allegedly trading insider information. Teixeira purchased options on Proofpoint stock on April 22, 2021, days before the announcement. Regulators have delayed Broadcom’s discount for VMware.
Teixeira allegedly shared the insider information with his associate, Jordan Meadow, who is also charged with violating federal insider trading laws.
The SEC alleged that Meadow used the information as an investment advisor, steering his customers toward lucrative opportunities and gaining “hundreds of thousands” of commissions.
Meadow also faces federal charges unveiled Thursday in the Southern District of New York.
“Our complaint alleges brazen betrayals of trust by Teixeira, who misappropriated information from his girlfriend’s laptop to complete a quick buck, and by industry-veteran Meadow, who was all too eager to use the information to line his pockets,” Scott Thompson, the SEC’s Philadelphia associate provincial director, said in a press release.