A Walt Disney Company employee and her boyfriend were arrested in an FBI undercover operation Wednesday for their part in an insider trading scheme.
(Walt Disney Company)
Bonnie J. Hoxie, an assistant to the head of corporate communications at Disney, and Yonni Sebbag were arrested and charged with wire fraud and conspiracy to commit securities fraud and wire fraud. If convicted, the pair face up to 20 years in prison. The Securities and Exchange Commission also filed a civil complaint against the two.
According to the criminal complaint, in March Hoxie and Sebbag sent an anonymous letter to several hedge funds offering inside information on the company’s quarterly earnings report set to be released in May. The letter gave an e-mail address as a contact. Several hedge funds sent the letter to U.S. Attorney’s office for the Southern District of New York and the FBI, which set up an undercover operation.
In late March and early April, several FBI agents posed as hedge fund traders and e-mailed the address offering to buy the information.
Three days before the earnings announcement, Hoxie and Sebbag allegedly sent the agents a copy of the Disney executive’s talking points, according to the complaint. On the day of the announcement, the pair also sent the agents a heads-up on what Disney would announce as the earnings per share. Three days later, the FBI arranged to meet with defendants and gave them $15,000 in payment for the tips.
The Wall Street Journal also noted an interesting tidbit: after the couple received the money, Hoxie insisted Sebbag buy her a $700 Stella McCartney handbag and a pair of Stella McCartney shoes from Neiman Marcus. No word on the color.
Read the criminal complaint here. See the SEC’s complaint here.
