Federals: the 1st case of insider trading on crypto-currencies traps 3
FILE – The Bitcoin logo is seen on the display screen of a cryptocurrency ATM in Salem, NH on Feb. 9, 2021. A former Coinbase product manager and his brother, as well as a Houston man, were charged, Thursday, July 21, 2022, in what federal authorities have described as the first case of U.S. government cryptocurrency insider trading. (AP Photo/Charles Krupa, File)
PA
NEW YORK
A former Coinbase product manager and his brother, along with a Houston man, were charged Thursday in what federal authorities have described as the first case of U.S. government insider trading in cryptocurrency.
The brothers – Ishan Wahi and Nikhil Wahi – were arrested while Houston man Sameer Ramani remains at large, federal authorities said as they announced the lifting of an indictment in Manhattan federal court .
Authorities say Ishan Wahi, 32, was a product manager at Seattle-based Coinbase Global Inc., one of the world’s largest cryptocurrency exchanges, when he gave advice to his brother. , Nikhil Wahi, 26, and their friend, Ramani, 33. All three were charged with wire fraud conspiracy and wire fraud.
Authorities said Ishan Wahi was detained by law enforcement before boarding a May 16 flight to India and prevented from leaving the country. In the hours before boarding, he had called and texted his brother and Ramani to alert them to an investigation Coinbase was conducting, according to a statement.
U.S. Attorney Damian Williams said the prosecution represents the government’s first insider trading case involving the cryptocurrency markets. He said it was a reminder that cryptocurrency markets are not a lawless zone.
FBI New York Bureau Chief Michael Driscoll said the defendants collected around $1.5 million in illegal profits by trading at least 25 different crypto assets.
Messages seeking comment have been sent to defense attorneys.
The Securities and Exchange Commission filed civil charges of insider trading against the men in federal court in Seattle.
The SEC said the charges were brought against the trio after they set up a trading plan ahead of several announcements regarding certain crypto assets that were going to be made available for trading on the Coinbase platform.
“As today’s case demonstrates, whether in stocks, options, crypto assets or other securities, we will justify our mission by identifying and combating insiders on securities everywhere we see them,” said Carolyn M. Welshhans, acting chief of the law enforcement division. Crypto assets and cyber unit.
