CHARLOTTE, N.C. -- A Wells Fargo Securities banker who lived in Charlotte has been charged by the Securities and Exchange Commission with orchestrating an $11 million insider trading scheme, the commission said Wednesday.

John W. Femenia, 30, allegedly used his position to find out nonpublic information on four pending merger transactions, according to the lawsuit filed in the federal court in Charlotte.

He then tipped off friend and broker Shawn C. Hegedus, 31, who in turn passed the information to other friends, the suit states. Hegedus and eight others who allegedly received trading tips were also indicted.

Here you have an investment banker who clearly knew better that inside information can t form the basis of trading decisions, said William P. Hicks, associate director for enforcement in the SEC s Atlanta office, in a statement. Instead he basically started a phone tree of nonpublic information to enrich friends and others.

Femenia lived in Charlotte when much of the insider trading took place, the SEC said, but moved to New York in May.

At least one person who received tips kicked back a portion of the profits to Femenia.

People receiving tips in Charlotte were Frank M. Burgess, Jr., 42, and James A. Hayes IV, 37, the commission said.

Wells Fargo was not available for an immediate comment.

Read more here: http://www.charlotteobserv

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