Former Equifax executive charged with insider trading for selling shares before breach news broke
Former CIO alleged to have sold shares before breach became public, reaping proceeds of nearly $1 million
The U.S. Securities and Exchange Commission has charged a former chief information officer with Equifax for selling shares in the company shortly before news of a massive data breach of the personal information of 148 million Americans became public in September.
According to the SEC, Jun Ying, who was chief information officer of one of the company's U.S. businesses at the time "allegedly used confidential information entrusted to him by the company to conclude that Equifax had suffered a serious breach" in late August.
"The SEC alleges that before Equifax's public disclosure of the data breach, Ying exercised all of his vested Equifax stock options and then sold the shares, reaping proceeds of nearly $1 million. According to the complaint, by selling before public disclosure of the data breach, Ying avoided more than $117,000 in losses," the SEC's complaint alleges.
The stock market regulator has charged Ying with violating the antifraud provisions of federal securities laws and is seeking "disgorgement of ill-gotten gains plus interest, penalties, and injunctive relief."
"Corporate insiders who learn inside information, including information about material cyber intrusions, cannot betray shareholders for their own financial benefit," said Richard Best, Director of the SEC's Atlanta office.
Ying is also facing criminal charges by federal authorities.
Shares of the Atlanta-based credit reporting firm plunged in early September after the company revealed it was the victim of a data breach.