Engineer Sentenced in L.A. to Prison for Insider Trading

Engineer Sentenced in L.A. to Prison for Insider Trading

by Contributing Editor

A former semiconductor engineer was sentenced Monday in Los Angeles to 18 months in federal prison for committing insider trading when he obtained his publicly traded employer’s non-public financial results without authorization and then illegally used the confidential information to purchase large amounts of stock prior to the information’s release.

Yuh-Yue Chen, 53, of Taiwan, was sentenced by U.S. District Judge Percy Anderson, who also ordered Chen to pay a $6,000 fine. Chen pleaded guilty on Oct. 1 to one count of securities fraud.

Chen was an electrical engineer at Skyworks Solutions Inc., a publicly traded Woburn, Massachusetts-based semiconductor company with a branch office and design center in Irvine. During the spring and summer of 2014, Chen bought Skyworks stock and options based on confidential information not yet available to the public.

Specifically, Chen used his employee security badge to gain unauthorized access to the company’s restricted office area for the accounting and financial staff.

Once inside, Chen went through the desks and work areas to find the company’s non-public earnings reports. Using this confidential information, Chen bought large amounts of Skyworks securities. Once Skyworks released its earnings reports to the public, Chen sold his Skyworks securities for a profit.

In September 2014, Chen left the United States for Taiwan five days after two Skyworks employees caught him rifling through company documents in the restricted accounting and finance office, according to court papers. Soon afterward, Skyworks fired him.

Through this insider trading scheme, Chen received more than $700,000 in illegal profit.

In a lawsuit brought by the Securities and Exchange Commission, Chen was ordered to pay a $739,959 judgment to the SEC stemming from his insider trading scheme while he was employed at Skyworks Solutions.

In March 2019, law enforcement interviewed Chen at Los Angeles International Airport, where he admitted to committing insider trading, according to court documents.

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All credit goes to Contributing Editor
Originally published on https://mynewsla.com