Former Congressman Charged with Insider Trading

Insider trading has been a key focus of SEC enforcement in recent months. This is consistent with the historical approach to enforcement by the agency over the years. In recent weeks, however, the agency appears to have become more aggressive in the area. One of the most recent examples of these cases involves a former Congressman from Indiana, SEC v. Buyer, Civil Action No. 1:22-cv-06279 (S.D.N.Y. Filed July 25, 2022).

Defendant Stephen E. Buyer is the principal of Steve Buyer Group, a business Mr. Buyer founded in 2011 after leaving the U.S. House of Representatives. The firm attempts to leverage Mr. Buyer’s congressional experience. It aids clients with issues related to matters such as Veterans Affairs and the telecommunications industry.

In 2018 and 2019, the former Congressman misappropriated material non-public information from two clients, using it to profitably trade. First in 2018 Mr. Buyer acted as a consultant for T-Mobile US, Inc. During his work he learned that T-Mobile planned to acquire Sprint Corporation. The planned acquisition was not public. Mr. Buyer misappropriated the material, non-public information. Prior to the deal announcement Mr. Buyer purchased 112,675 shares of Sprint stock at a cost of $568,000. Following the April deal announcement he had profits of $107,987.

Mr. Buyer also misappropriated material, non-public deal information the next year. In 2019 he acted as a consultant to Guidehouse LLP. The firm planned to acquire Navigant Consulting. Mr. Buyer misappropriated the inside information about the deal and used over $1 million to purchase 46,654 shares of Navigant stock. He used the accounts of his wife and son to make the acquisitions as well as one of a Friend. Following the deal announcement in August 2019 Mr. Buyer had profits of about $227,742. The complaint alleges violations of Exchange Act Section 19(b). The case is pending. See Lit. Rel. No. 25448 (July 25, 2022).