Newswire developer sentenced for insider trading

A software developer who worked at a newswire service has been fined $1.4 million and sentenced to six months in jail after pleading guilty to insider trading.

In 2022, a pair of Brampton, Ont.-based developers at Intrado Corp., which operates GlobeNewswire — Harpreet Saini and John Natividad — were charged with insider trading by both the Ontario Securities Commission (OSC) and the U.S. Securities and Exchange Commission (SEC). The regulators alleged that they traded on inside information acquired from corporate press releases before they were publicly released.

The OSC announced that Saini, who pled guilty in July 2024, has been sentenced to six months less a day in jail and fined over $1.4 million — comprised of full disgorgement of his illicit insider trading profits, plus $100,000 and a mandatory 25% surcharge. The regulator said he will also be subject to a 10-year trading ban.

According to the OSC, Saini admitted to accessing material, non-public information between May 2018 and July 2021 and to trading on that information over 500 times, generating US$770,000 in illicit trading profits.

“Employees who have access to confidential corporate information have a duty to safeguard that information and not misuse it for their personal benefit,” said Bonnie Lysyk, executive vice-president, enforcement, at the OSC, in a release.

“Insider trading is illegal, and it erodes investor confidence in our markets. The OSC will continue to use all the tools at our disposal to root out this type of misconduct and pursue bad actors,” Lysyk said.

The case against Natividad remains before the courts. The allegations against him have not been proven.

The proceedings in the U.S. were stayed by the U.S. District Court in New Jersey, pending the outcome of the Canadian cases against them.

While the SEC opposed granting a stay, the court ruled a stay was warranted in the interests of justice.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.