According to the Wall Street Journal, a former quantitative analyst for a global asset manager was charged with securities fraud by operating a front-running scheme using his ex-wife’s personal brokerage account to buy or sell stock in advance of large pending purchase or sale orders by his employer on behalf of clients. As an analyst, Sergei Polevikov had access to information in real-time about pending trades in Oppenheim’s internal system. According to reports, the personal account of Mr. Polvikov’s wife showed about 2,800 instances of trading that allowed a similar pattern. Front running is a form of insider trading that occurs when a trader is aware of major buy or sell orders and engages in trades based upon that inside knowledge. That is because when major buy or sell trades occur, they raise or lower stock prices due to the mere size of the purchases or sales. It is well known in the finance and brokerage business that front running is one of the most common insider trading schemes on Wall Street but it takes an insider whistleblower to reveal the details to allow authorities to present sufficient information to bring a case. Mr. Polevikov denies the charges but if found guilty could face up to 20 years in prison.
JEFFREY NEWMAN, A FORMER PROSECUTOR, IS A WHISTLEBLOWER LAWYER WITH THE NATIONAL FIRM NEWMAN & SHAPIRO. HE FREQUENTLY REPRESENTS WHISTLEBLOWERS IN LARGER SEC WHISTLEBLOWER MATTERS WHICH INCLUDE MAJOR FRONT-RUNNING CASES REVEALED BY INSIDERS. ATTORNEY NEWMAN CAN BE REACHED AT JNEWMAN@NEWMANSHAPIRO.COM OR AT 978-880-4758