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Securities Law
Lawyer who once directed corporate law at Apple pleads guilty to insider trading
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A former top lawyer at Apple who was tasked with enforcing its insider trading policy pleaded guilty Thursday in a scheme to trade on the company’s material, nonpublic information.
The lawyer, 48-year-old Gene Levoff of San Carlos, California, had been the corporate law chief for Apple before he was placed on leave in 2018 and then fired in September 2018, report Bloomberg, the New York Times, Law360 and a Department of Justice press release. He pleaded guilty to six counts of a federal securities fraud indictment.
Prosecutors had alleged that Levoff made $227,000 in profits and avoided $377,000 in losses by trading in Apple stock using confidential information.
The insider trading scheme lasted from February 2011 to April 2016, prosecutors said. Levoff used information that he gained as co-chair of Apple’s disclosure committee, which reviewed earnings materials and filings with the Securities and Exchange Commission before they were made public.
Before Apple revealed strong revenue, Levoff bought large quantities of stock and later sold it for a profit, prosecutors said. Before Apple revealed lower-than-anticipated revenue, Levoff sold large amounts of his Apple stock to avoid losses.
Levoff faces a maximum penalty of 20 years in prison and a $5 million fine on each securities fraud count. He is scheduled to be sentenced Nov. 10.
Levoff had tried to get the case dismissed in 2020 based on an argument that no statute specifically bars insider trading, according to Bloomberg and the New York Times.
“Prosecutors called his argument a bogus ‘Hail Mary,’ and it was rejected by the judge,” according to Bloomberg.
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