Court grants forfeiture motion against fugitive insider trading defendant

On November 7, 2019, the US District Court for the District of Massachusetts granted a motion for bond forfeiture secured by the defendant’s family home. The case was initiated in April 2015 with a criminal complaint charging Iftikar Ahmed and another defendant with securities fraud in violation of 15 USC §§ 78j(b) and 78ff, Sections 10(b) and 32 of the Securities and Exchange Act of 1934 and Rule 10b-5 thereunder.  The complaint alleged that Ahmed’s co-defendant acquired material nonpublic information about the acquisition of Cooper tire & Rubber Company in 2013, and shared the information with Ahmed and another tippee, who purchased shares in the tire company as a result of the tip, and then sold them at a profit following the public announcement of the acquisition.

Ahmed was released after co-signing an appearance bond of $9 million with his wife, which was secured by equity in their Connecticut residence.  Ahmed and his wife later signed an escrow agreement and executed a warranty deed on the residence in order to secure Ahmed’s compliance with the terms of the court’s bail order.  Shortly thereafter, however, Ahmed absconded and has failed since then to comply with the terms of his bail, and the government moved on May 24, 2019 for forfeiture of the bond because Ahmed is a fugitive.  The court granted the government’s motion, and denied a motion to intervene that was brought by Ahmed’s wife. 

In a separate action, the US Securities and Exchange Commission brought civil charges against Ahmed in May 2015, alleging that he used fraudulent and deceptive means to divert over $67 million into his personal bank accounts from ten different venture capital investments.  When the complaint was brought, the SEC also secured an order freezing Ahmed's assets.  On March 29, 2018, the US District Court for the District of Connecticut granted the SEC's motion for summary judgment as to Ahmed's liability.

SEC Litigation Release


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