SEC-EDGAR Staffers Busted in Brazen $1M Insider Trading Plot—Because Paperwork Was Too Boring?
Regulators just proved even compliance officers can't resist the siren song of easy money.
Two SEC-EDGAR filing employees allegedly turned their back-office access into a $1 million side hustle—because apparently government salaries don't cover avocado toast these days. The scheme unraveled faster than a DeFi rug pull when suspicious trades flagged their internal surveillance systems.
Who needs Wall Street connections when you've got admin privileges? The accused allegedly exploited non-public corporate filings—the kind of snooze-worthy documents that normally put traders to sleep—to front-run market-moving announcements. Pro tip: If you're going to commit financial crimes, maybe don't use your work email.
The irony? These gatekeepers were supposed to prevent market manipulation, not perfect it. But hey, in today's economy, everyone needs a side hustle—even if it means violating the very laws you're paid to enforce. Just another day in America's financial playground, where the house always wins... until it doesn't.
Two men from Brooklyn have been charged with insider trading after allegedly stealing confidential corporate information to make illegal profits. According to a report from Bloomberg, the pair earned around $1 million by accessing sensitive data from companies before it was made public.
Brooklyn Duo Charged in $1M Insider Trading
Justin Chen, 31, and Jun Zhen, 29, worked at EdgarAgents.com, a private company that handles SEC filings for businesses. Chen served as an operator and assistant manager, while Zhen worked as a typeset manager and operator.
Authorities say they used their positions to secretly gather non-public information about several companies, including Purple Innovation, Ondas Holdings, SigmaTron, and Signing Day Sports, and then traded on that information to make quick profits.
However, former SEC official Marc Fagel reacted to the news and wrote on social media, “Misleading headline. They don’t work for the SEC; they worked for a private firm that helps companies with their EDGAR filings.”
Secret Merger Trades Point to Team Trading
Prosecutors revealed that between March and June 2025, they used secret merger information to buy stocks before the news was public. Chen and Zhen placed trades within minutes and hours of each other, which shows that they were involved in a coordinated scheme.
According to a federal complaint, Chen and Zhen bought the stocks before merger news broke and quickly sold them after the announcements for big gains. They reportedly made over $1 million in profits from the trades. The FBI agents arrested Chen and Zhen on Friday night at the John F. Kennedy International Airport, just as they were about to fly to Hong Kong.
They are now facing securities fraud charges that carry up to 25 years in prison. A judge ordered them held without bail after they appeared in Brooklyn federal court on Saturday.
Insider Trading Crackdown Hits Top Executive
In related news, Terren Peizer, former CEO of Ontrak and former protégé of junk bond king Michael Milken, was recently sentenced to 3.5 years in prison for insider trading. He was fined $5.25 million and ordered to forfeit over $12.7 million in profits.
Peizer was found guilty of misusing SEC Rule 10b5-1 trading plans, rules that were meant to protect company insiders from fraud claims. He used them to sell $20 million in Ontrak shares before bad news about a major client, Cigna, was made public.
