New York man admits to insider trading, after being linked to reporter's tips

[NEW YORK] A New York City man pleaded guilty on Tuesday (Mar 29) to insider trading and tax evasion charges, a year after prosecutors accused him of using information from a Bloomberg News reporter about certain deals to trade.

Jason Peltz, 39, entered the plea in Brooklyn federal court to 2 counts of insider trading and tax evasion a year after initially pleading not guilty. He has been engaged in plea negotiations with prosecutors since at least September 2021, court records show.

"This office will vigorously prosecute traders who seek to cheat the system, harm the investing public and undermine the integrity of our financial markets," Breon Peace, the US Attorney for the Eastern District of New York, said in a statement.

In March 2021, a federal grand jury indicted Peltz for trading on "material nonpublic information" obtained from a company insider and a financial reporter.

The indictment does not name the journalist or the media outlet, but Reuters and other media outlets have identified him as Ed Hammond, a deals reporter with Bloomberg in New York, based on a review of articles mentioned in the indictment.

Hammond is not accused of any wrongdoing.

"Ed Hammond is a very accomplished reporter," a Bloomberg News spokesperson said in a statement. "We're not aware of any facts to suggest any wrongdoing on his part." The scheme ran from November 2015 to October 2020, according to the indictment.

In a statement read to US District Judge Nicholas Garaufis in court on Tuesday, Peltz said he purchased securities in chemical manufacturer Ferro based on information, obtained from a friend, that Ferro had received a takeover offer. He said he knew trading off that information was illegal.

Apart from the Ferro transaction, the indictment alleges Peltz had frequent conversations with the reporter over several months, during which he obtained material nonpublic information about articles the reporter was working on regarding other companies.

Each article mentioned in the indictment cited multiple sources and involved 2 or more reporters.

Peltz is scheduled to be sentenced in July. REUTERS