On March 14, 2025, the Securities and Exchange Commission announced that it charged Eamma Safi and Zhi “Josh” Ge for their alleged roles in an elaborate international insider trading scheme in which securities trades were made in advance of ten market-moving announcements, such as earnings releases and acquisition offers. Safi, a German citizen, and Ge, a Singapore citizen, allegedly generated more than $17.5 million in illegal profits from a scheme that involved tips originating from corporate insiders and/or investment bankers known to Safi.
According to the SEC’s complaint, from approximately 2017 to about 2024, Safi shared material nonpublic information obtained from various insiders with Ge and an unnamed individual (“Trader A”) that Ge recruited. Based on the MNPI, the three allegedly generated profits by illegally trading in securities of numerous companies using their own individual trading accounts and brokerage accounts in the names of other people and entities that they controlled. Safi and/or Ge also allegedly demanded and received kickbacks from Trader A in exchange for the illegal tips. According to the SEC, the tips related to U.S.-based public companies and foreign public companies traded on foreign exchanges with American depositary receipts (“ADRs”), a process that essentially enables investors to trade in foreign equities on U.S. exchanges. In furtherance of the scheme, Safi allegedly leaked MNPI to journalists and news outlets to enable scheme participants to earn profits based on market reactions to the news rather than waiting for corporate press releases to generate profits. Scheme participants also allegedly attempted to conceal the scheme by using coded and disappearing messages to communicate about their trades.
The SEC, which filed its complaint on March 4, 2025 in the U.S. District Court for the District of Massachusetts, charged Safi and Ge with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC is seeking permanent injunctions against both defendants as well as the disgorgement of profits, prejudgment interest, and civil monetary penalties.
On March 4, 2025, the U.S. Attorney’s Office for the District of Massachusetts also filed parallel criminal charges against Safi and Ge and unsealed a six-count indictment for their roles in the insider trading scheme. While the USAO issued arrest warrants for both Safi and Ge, only Safi has been arrested to date. On February 27, 2025, Safi pleaded not guilty to the criminal charges.
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