An Amazon finance manager has been accused of insider trading, along with her husband and father-in-law who collectively bought and sold Amazon shares based on non-public financial details it is said she leaked to her spouse.
Collectively, the trio made $1.4m in profit from their little scam, America's financial watchdog the SEC claimed on Monday. In a settlement with the SEC, all three of the accused agreed to pay back the dosh as a disgorgement to the government, and cough up $1.1m in penalties and $118,406 in interest – about $2.6m total – after the regulator sued [PDF] them in a federal district court in Washington state.
Laksha Bohra, 36, worked for Amazon in Seattle, starting in 2012 as a transfer pricing manager in its tax department. Between January 2016 and July 2018 she helped prepare and review the web giant’s quarterly earnings figures.
During that time she repeatedly ignored internal warnings to not get involved in any insider trading, and according to the SEC, gave her husband, Viky Bohra, also 36, and father-in-law Gotham Bohra, 63, details of confidential financial information that she had access to through her work computer: details they then used to play the stock market. The trades were persistent and large transfers happened ahead of every single earnings announcement through accounts controlled by the three of them, the regulator noted. They repeatedly capitalized on stock jumps of two to four per cent, plugging the money back into their next stock buy, we're told.
Amazon has a “zero tolerance” insider-trading policy, something all finance department employees were reminded of by Amazon’s CFO personally in September 2017 after another employee was collared for insider trading. All staff who saw the highly confidential information before it became public were also reminded repeatedly in the lead up to the earnings reports that they were not to trade any Amazon securities except with the explicit approval of its legal department, nor tell anyone, including family, any details about the figures. Amazon also imposed blackout trading periods around earnings time.
Not exactly Ocean's Eleven
Considering all that, their alleged insider trading efforts were pretty amateurish. They opened no fewer than 11 accounts – all with the same trading platform – and under different family names. They then grew tired of operating each account independently and so, in records clearly provided under subpoena, they asked the trading company to treat them the same and allow all three of them access to the funds.
Combined with Amazon’s logs of Laksha Bohra’s work computer, which included repeat checks of Amazon’s share price and the company’s confidential financial dashboards, it wasn’t hard to connect the dots. Amazon suspended Bohra in October 2018, and she resigned shortly after.
Although the SEC legal action will see them all pay a hefty financial price, it’s just the start of their problems: the US Attorney's Office for the Western District of Washington has already filed criminal charges against Viky. ®