Insider Trading Scandal: CEO Sells Stock After Learning of Termination
The former CEO of a Long Island telecommunications company is facing serious charges for allegedly engaging in insider trading post the shakeup news of a negative earnings report and his own termination. Ken Peterman, the former head of Comtech Telecommunications Corp., a company situated in Melville, New York, was arrested on insider trading and securities fraud complaints earlier this week.
Reports suggest that Peterman allegedly used confidential company details to his advantage, including insights into the company’s poor financial performance and his imminent firing, to offload tens of thousands of shares quietly before this insider data became public knowledge. The 67-year-old executive, at the time of the incident, was taken into custody in San Diego and has an initial court appearance slated in the Southern District of California.
The accused will face further legal proceedings, with an arraignment set for the Eastern District of New York. Breon Peace, the U.S. attorney for the Eastern District, highlighted the severity of the situation, stating that Peterman violated the expected code of conduct by exploiting inside information like his impending termination to suit his personal interests, breaking the trust bestowed upon him by the organization.
