Thirty Charged in Decade-Long Insider Trading Scheme Involving Law Firm Information

Charges were unsealed on Wednesday against 30 defendants in connection with a decade-long insider trading scheme, according to a release from the Massachusetts District Attorney's Office. The defendants include corporate attorneys and other financial professionals.

Nineteen of the defendants were arrested Wednesday and are scheduled to appear in court in various cities across the U.S. Two of the defendants are located in Russia and Israel and are considered fugitives. The defendants are alleged to have stolen and traded on confidential information related to nearly 30 merger and acquisition deals from several major U.S. law firms.

A 2022 text exchange between two defendants, Gavryel Silverstein and Simon Fensterszaub, was included in the release as an example of coded language used in the scheme. " Fensterszaub asked, allegedly referring to a deal involving iRobot. "He's stable," Silverstein responded.

" Both Silverstein and Fensterszaub are among 16 defendants charged with two counts of conspiracy to commit securities fraud, two counts of securities fraud, and one count of conspiracy to commit money laundering.

A statement from federal authorities said the operation involved an international network that obtained material non-public information from premier U.S. law firms, including one in Massachusetts. The statement added that the defendants are accused of generating significant profits from expected market moves based on that information.

"The trading on unannounced financial news alleged here not only violated the securities laws, but it also took advantage of the special access and ethical duties that come with a law license," said United States Attorney Leah B. Foley. Foley stated that the charges resulted from a years-long investigation with law enforcement partners and are part of ongoing efforts to maintain equal access to markets for all investors.

The statement noted that if investors believe trading is only for those with special connections, they may withdraw from markets, which could affect the broader economy.