SEC charges former GOP Rep. Stephen Buyer with insider trading - CNBC

(File 1988) House Judiciary Committee member Rep. Stephen Buyer (R/IN) carries his research materials away at the conclusion of the impeachment proceedings December 12.

Reuters

WASHINGTON -- Former Indiana Republican Rep. Stephen Buyer has been charged with insider trading, using accounts owned by his wife and longtime mistress to hide some of the transactions, the Securities and Exchange Commission announced Monday.

Buyer, who left Congress in 2011, is accused of trading on nonpublic information he received as a consultant after he left office.

According to the civil complaint filed in Manhattan federal court, Buyer bought more than $1.5 million in stock in two separate companies, Sprint and Navigant Consulting, based on insider information over the span of two years.

He sold the shares of Sprint in 2018 after its merger with T-Mobile leaked, for a profit of at least $107,000 according to the SEC. He sold the Navigant shares in 2019 after news became public that Navigant would be acquired by Guidehouse.

An attorney for Buyer, Andrew Goldstein, told CNBC, "Congressman Buyer is innocent. His stock trades were lawful. He looks forward to being quickly vindicated." Goldstein is a partner at the law firm Cooley LLP.

The SEC complaint details how Buyer used several different accounts, including his wife Joni Buyer's brokerage account, to purchase the shares. Joni Buyer is not accused of any legal wrongdoing, but she is named in the charges because she technically benefited from the ill-gotten gains in her investment account.

Buyer allegedly spread the stock purchases across seven different accounts, including two separate IRAs belonging to him alone; an investment account belonging to his wife Joni Buyer; a joint account owned by the couple; a joint account Buyer shared with his son; a joint account Buyer shared with his cousin, and a seventh account owned by a woman identified only as "Friend-1."

According to the SEC complaint, Buyer began a romantic relationship with the unidentified woman in 2006. In 2018, Buyer used the woman's IRA account to purchase more than $12,000 worth of stock in Sprint. A year later, he allegedly used her account again to buy $22,000 of stock in Navigant, shortly before both companies were acquired by Buyer's consulting clients.

"When insiders like Buyer – an attorney, a former prosecutor, and a retired Congressman – monetize their access to material, nonpublic information, as alleged in this case, they not only violate the federal securities laws, but also undermine public trust and confidence in the fairness of our markets," said Gurbir S. Grewal, director of the SEC's enforcement division, in the SEC press release.

Buyer served in Congress from 1993-2011, where he represented Indiana's 4th Congressional District, which was previously numbered as its 5th.