WASHINGTON (Reuters) - Federal prosecutors announced Monday they had indicted a former executive vice president of the wireless technology company Qualcomm Inc for insider-trading and conspiring with his brother and his broker to launder the money and obstruct a government probe.
The September 20 indictment accuses Jing Wang, 51, of Del Mar, California, of working with former Merrill Lynch broker, Gary Yin, to create an offshore account that appeared to be owned by Wang’s brother, for the purpose of concealing ownership and avoiding taxes.
Wang then allegedly directed Yin to make trades based on material non-public information about Qualcomm’s financial results, acquisition plans and dividends.
The U.S. Attorney for the Southern District of California said the FBI took Wang into custody on Monday, and that he was expected to appear in court in the afternoon.
Yin was also criminally charged. He will appear in court on Tuesday, prosecutors said. A warrant was issued for the arrest of Wang’s brother Bing Wang, a citizen and resident of China.
The U.S. Securities and Exchange Commission on Monday filed parallel civil charges against Wang and Yin. Their lawyers could not be immediately reached.
Qualcomm was not charged. General Counsel Don Rosenberg said the company has been fully cooperating with the government’s investigation. He said Jing Wang is no longer employed by Qualcomm.
According to the Justice Department, Yin helped Jing Wang create an offshore account in the British Virgin Islands and set it up to make it appear that Bing Wang owned it.
Jing Wang then allegedly passed nonpublic tips on Qualcomm results, a dividend increase, a stock repurchase program, and a 2011 plan to buy Atheros Communications.
In addition, prosecutors said Jing Wang and Yin conspired to obstruct the SEC by trying it make it look like Bing Wang made the illegal trades.
The cases are U.S. v. Wang et al, U.S. District Court, Southern District of California, No. 13-cr-03487; and SEC v. Wang et al in the same court, No. 13-02270.
Reporting by Sarah N. Lynch; editing by Andrew Hay