Former Adobe software engineering leader convicted of insider trading

Another Silicon Valley Icarus flies too close to the Sun

A former Adobe software engineer was this week sentenced to 18 months in prison for his role in an insider trading scheme that earned him millions before the feds caught on.

Srinivasa Kakkera, who is only described in the original indictment as "the head of engineering for a large publicly traded software company," will have to go to prison and forfeit some $2.45 million he earned using knowledge handed to him by Amit Bhardwaj, former CISO at Lumentum Holdings. 

As for Bhardwaj, who was last year sentenced to 24 months in prison and fined $975,000, prosecutors say he used his role to enrich himself and pass on knowledge of multiple Lumentum acquisitions to Kakkera and other associates. 

According to the US Attorney's Office for the Southern District of New York (SDNY), Kakkera bought shares of a telecom tech company known as Neophotonics, which Lumentum was going to acquire, based on knowledge obtained from Bhardwaj. Bhardwaj had previously profited off Lumentum's acquisition of Coherent, in which he bought securities as a result of his employer's plan to purchase the firm.

Per the SDNY, Kakkera also tipped off others, including a close family member who bought shares in Neophotonics following Bhardwaj's advice. Collectively, the inside traders made some $4.3 million in profit, the feds claim.

When the FBI got wind of the scheme, it interviewed Bhardwaj, Kakkera, and a third person, Abbas Saeedi, about their potential involvement in an insider trading ring. Following talks with the feds, the trio conspired to cover their tracks.

"They met in person on multiple occasions and discussed, among other things, potential false stories that would conceal their insider trading scheme as well as creating false documents to buttress lies regarding payments that were, in reality, related to the insider trading scheme," the US Attorney's Office said.

A LinkedIn page believed to be Kakkera's lists his job at Adobe, where he worked during the period of his insider trading activity as the head of engineering for AI/ML and analytics at subsidiary Marketo. Kakkera's salary was reportedly in excess of $1 million per year while working for the Photoshop maker.

Saeedi was also convicted for his role in concealing the conspiracy, and was sentenced to five months in prison as well as having to forfeit $691,000 he made through the scheme.

"Insider trading is not easy money: if you try to illegally profit from material, non-public information, there's a price to be paid," said US Attorney Damian Williams. ®

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