Former Federal Reserve Official Admits to Insider Trading
A former official from the Federal Reserve Bank of Richmond recently pled guilty to insider trading after using confidential information to make trades. The defendant, Robert Brian Thompson, had access to sensitive information about financial institutions under the Fed’s supervision due to his role as a bank examiner and senior manager.
Thompson executed 69 trades in seven publicly traded financial institutions, totaling $771,678 between October 2020 and February 2024. To cover up his actions, he provided false information on his “Form D” regarding his assets, claiming he had none, when in reality, he did.
As a result, Thompson pleaded guilty to insider trading and making false statements. He is set to be sentenced on March 19 and could face up to 20 years in prison for insider trading and five years for false statements.
In addition to the criminal case, the Securities and Exchange Commission (SEC) also filed a complaint against Thompson. The SEC alleged that he made significant profits by trading on nonpublic information about upcoming earnings announcements of different banks.
Thompson has reached a settlement with the SEC, agreeing to give up his illicit gains pending approval from a judge.
This case serves as a reminder of the importance of maintaining trust and integrity in financial markets to ensure a level playing field for all investors.
