A divided appeals court on Tuesday rejected the insider trading convictions of four men, including an ex-government employee turned consultant, prompting a sharp dissent from a judge who says the ruling may prompt insiders to sell confidential government information to the highest bidders.
The decision of the 2nd U.S. Circuit Court of Appeals came in a case in which a Washington consultant, David Blaszczak, was charged with converting government secrets into hedge fund profits.
In 2018, a jury convicted Blaszczak and three hedge fund employees in a scheme prosecutors said enabled the hedge fund workers to make over $3.5 million illegally for their company from 2012 through 2014. The Securities and Exchange Commission said the profits reached $3.9 million.
Before becoming a consultant, Blaszczak worked at the Centers for Medicare & Medicaid Services, part of the U.S. Department of Health and Human Services.
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