Antonia Apps, partner in Milbank’s White Collar Group, spoke with The New York Times about insider trading case U.S. v. David Blaszczak in an article titled: “Insider-Trading Case Ensnares Hedge Fund.”
David Blaszczak, a political intelligence consultant and former employee at the Centers for Medicare and Medicaid Services, was charged by the SEC and DOJ with obtaining confidential information from a CMS employee about upcoming CMS policy decisions, and tipping two analysts at a hedge fund advisory firm. The governments also charged the CMS employee and the two hedge fund analysts, who allegedly used the information they received from Mr. Blaszczak to recommend that the hedge fund trade in the stocks of four health care companies that would likely be affected by the proposed changes. The hedge fund allegedly paid Mr. Blaszczak to provide the CMS information and the trading resulted in millions of dollars in illegal profits, according to federal prosecutors in Manhattan and securities regulators, as reported in The New York Times.
Ms. Apps noted that the case represents a significant development in the law. In The New York Times article, she commented: “[A]s the second political intelligence case brought by the SEC and DOJ, this case underscores the government’s focus on political intelligence firms and the need for investment professionals to closely monitor the sources of information that potentially emanates from government agencies.”
