SAN DIEGO (CNS) - A former senior executive at Qualcomm Inc. was charged Monday with insider trading in shares of both Qualcomm and Atheros Communications, allegedly making $250,000 in illegal profits from three transactions.
Jing Wang, a former executive vice president as well as president of Global Business Operations for Qualcomm, is accused in a federal indictment of conspiring with his older brother and his former Merrill Lynch stockbroker to obstruct an ongoing Securities and Exchange Commission investigation and laundering proceeds of his insider trading using an offshore shell company and secret brokerage account.
Jing Wang, 51, surrendered to the FBI Monday and was expected to make his first appearance in court that afternoon.
A warrant was issued for the arrest of Bing Wang, 53, who is believed to be a citizen and resident of China.
Stockbroker Gary Yin was charged in a criminal information and is expected in court Tuesday.
"When there are two sets of rules -- one for the powerful insiders and one for everybody else -- the public quickly loses confidence in the stock market," said U.S. Attorney Laura Duffy. "We intend to restore confidence in our markets by making sure that everyone is playing by the same rules."
According to the indictment, Wang used Yin to create an offshore entity, Unicorn Global Enterprises, and to open a brokerage account for Unicorn at Merrill Lynch.
The younger of the two brothers provided documents to Yin to create the false impression that his sibling controlled the account, when in fact Jing Wang was the true owner of the account, the government alleges.
The move allowed Jing Wang to conceal his true ownership and control of the assets in the account and to avoid reporting to U.S. tax authorities. It also allowed him to disguise his transfer of large sums of money to China, according to the indictment.
The indictment alleges that after the creation of the Unicorn account, Jing Wang was named an executive vice president of Qualcomm and fell within the company's insider trading restrictions for officers. As an officer, Wang was exposed to Qualcomm's confidential business information, and was repeatedly notified that he was not permitted to use material, non-public information to engage in stock transactions, according to the indictment.