Ex-US congressman ‘abused trust’ to trade before mergers, prosecutor says
3:26 pm Wednesday, March 01st, 2023
By Jody Godoy
(Reuters) – Former U.S. Congressman Stephen Buyer illegally traded on information he learned as a consultant to T-Mobile US Inc ahead of its $23 billion merger with Sprint, a federal prosecutor told jurors at Buyer’s criminal trial in New York on Wednesday.
Assistant U.S. Attorney Margaret Graham said in opening statements that Buyer, who represented Indiana as a Republican in the U.S. House of Representatives between 1993 and 2011, learned about the then-impending merger from a T-Mobile executive in 2018.
Buyer’s consulting clients, which also included Guidehouse Inc, trusted him with confidential information, Graham said.
“He abused that trust and used his clients’ information to trade,” she said.
Buyer made more than $100,000 from the Sprint trades, and more than $200,000 on stock in Navigant Consulting Inc, which he purchased before the company was acquired by Guidehouse in 2019, Graham said.
Buyer’s attorney Daniel Alonso said prosecutors cannot prove Buyer learned about either merger before it happened.
T-Mobile executive Tony Russo initially told investigators he did not remember the conversation with Buyer, Alonso said.
Alonso said Buyer had relied on public analysts and deduced that Guidehouse would acquire Navigant.
“Guessing and speculating about an acquisition is perfectly legal,” he said.
Buyer faces four counts of securities fraud at the trial, which is expected to last around three weeks.
Buyer was one of seven people, including a former Goldman Sachs banker, charged with insider trading in July as part of a crackdown by Damian Williams, the U.S. attorney for the Southern District of New York.
(Reporting by Jody Godoy in New York; Editing by Noeleen Walder and Bill Berkrot)
