Federal regulators have accused a Wells Fargo investment banker of passing tips about pending mergers to nine others in an insider-trading ring.
A federal civil lawsuit filed Wednesday by the Securities and Exchange Commission said John Femenia and his nine associates, also named as defendants, made more than $11 million by trading on the non-public information.
The SEC obtained a court order freezing the assets of the defendants and two companies associated with them, according to William P. Hicks, the associate director for enforcement at the SEC in Atlanta.
Femenia, 30, and his friend Shawn Hegedus, a stockbroker, allegedly tipped off the others over a two-year period ending in July, according to the SEC suit, filed in U.S. District Court in Charlotte, N.C. The lawsuit seeks to recover the alleged illicit profits and have a judge impose civil fines.