Ex-KPMG Partner Accused Of Insider Trading
DAVID GREENE, HOST:
In Los Angeles, a former partner at KPMG - one of the "big four" accounting firms - has been charged with insider trading. As NPR's Nina Gregory reports, Scott London is accused of trading tips for money and gifts.
NINA GREGORY, BYLINE: The details in the Justice Department's criminal complaint against Scott London read like bad fiction - bags of hundred-dollar bills wrapped in $10,000 bundles; a Rolex worth an estimated $12,000; secrets shared at the country club; and covert recordings of phone calls.
As KPMG's lead auditor for clients including Herbalife and Skechers, London had access to detailed corporate financial information the public did not. He allegedly passed tips to his friend Bryan Shaw, who in turn made over $1.2 million trading stocks. In return, London got the bags of cash and the watch.
ANDRE BIROTTE: These are very serious allegations.
GREGORY: Andre Birotte is the U.S. attorney for the Central District of California.
BIROTTE: He was entrusted to obtain and keep information secret, and not to disclose it. I mean, an auditor acts as a gatekeeper, if you will; and he broke that trust for his benefit.
GREGORY: London's lawyer says he plans to plead guilty. He could face up to five years in prison, and a $250,000 fine. No charges have been filed yet against London's friend Bryan Shaw.
Nina Gregory, NPR News. Transcript provided by NPR, Copyright NPR.