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Former Qualcomm Analyst Accused on Insider Trading
US federal regulators have filed a lawsuit against Andres Leyva - former Director of Strategic Marketing Analysis of US telecoms firm Qualcomm - for allegedly trading in company stock while in possession of confidential corporate information.
The Securities and Exchange Commission (SEC) claims that Leyva made nearly $35,000 in illegal profits after trading on the basis of confidential information about Qualcomm's new licensing agreement with Nokia, and the settlement of litigation between the two companies.
At the time, the firms were involved in a lawsuit to determine whether Nokia owed Qualcomm royalty revenues when the companies' licensing agreement expired in 2007.
The complaint alleges that on July 22 2008, the day before the trial, Leyva discovered that Nokia had agreed to settle the case out of court, and had increased its upfront payment of $500m to $2.5bn. Later that day he bought 80 Qualcomm call options at 39 cents each, which gave him the right to buy shares of the firm's stock at $50.
Once the lawsuit agreement settlement had been announced, Qualcomm's stock price rose 17% to $52.43 and Leyva sold the call option contracts - making $34,739 profit.
In August, Leyva was fired for violating Qualcomm's insider trading policy. The company is currently cooperating with the SEC, which is seeking repayment of Leyva's profits, plus a penalty which could be up to three times that amount.
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