SEC Adds to DOJ Allegations Against Two Men Accused of Insider Trading Based on Stolen Corporate Regulatory Filings

SEC Says Two Brooklyn Men Made $2.2 Million in Insider Trades

The US Securities and Exchange Commission laid out new allegations against two men from Brooklyn, New York, who are accused of stealing confidential information from jobs processing corporate regulatory filings, now saying the pair pocketed more than $2.2 million from illicit trades.

The SEC lawsuit follows criminal charges from US prosecutors in June. Authorities arrested Justin Chen, 31, and Jun Zhen, 29, on June 28 as they were about to board flights to Hong Kong.

In addition to four episodes of alleged insider trading cited by federal prosecutors, the SEC’s complaint added at least nine more trades. At a court hearing in the criminal case earlier this summer, prosecutors had said the pair had made at least $1 million from the illegal trading.

SEC Charges Former Executive and Friends in Insider Trading Scheme

On August 18, 2025, the Securities and Exchange Commission filed charges against Brent Cranmer, Jonathan Whitesides, and Daniel McCormick, for their alleged involvement in insider trading that generated over a million dollars in profits from trading in the securities of Kaman Corporation in advance of a January 19, 2024 announcement that Arcline Investment Management, L.P. had offered to acquire Kaman.

According to the SEC’s complaint, while Cranmer was working as the head of a Kaman subsidiary, he learned that Kaman was planning to sell itself. Cranmer allegedly tipped his friend Whitesides in an effort to coordinate trading for himself, and then Whitesides tipped his friend, McCormick. The complaint alleges that Whitesides and McCormick made combined profits of over a million dollars by trading in advance of the announcement, but no one traded for Cranmer.

Manhattan Judges Approve Trump’s Choice for U.S. Attorney

Manhattan’s federal court judges on Monday retained Jay Clayton as the U.S. attorney for the Southern District of New York, a victory for President Trump, who had named him to lead the office temporarily after his Senate confirmation was blocked.

Mr. Clayton’s appointment will last until a Senate-confirmed candidate can be installed to run what has been the country’s most prestigious prosecutor’s office. In practical terms, the decision means he may end up serving for the duration of the Trump administration; New York’s senior Democratic senator, Chuck Schumer, has said he would stop Mr. Clayton’s confirmation.

Recent Developments in the Law of Federal Property Fraud: It’s a Long and Winding Road

The text of the wire fraud statute is deceptively simple: it criminalizes “any scheme or artifice to defraud, or for obtaining money or property by means of false of fraudulent pretenses, representations, or promises” in which there was an interstate wire transmission. 18 U.S.C. § 1343. And yet, as the foregoing discussion demonstrates, for more than three decades, this statutory language has led to aggressive prosecutions, overturned convictions and headaches for lawyers and judges—with a rich history of flip-flops, divided decisions and nuanced distinctions in the case law. The recent decisions in Chastain, Johnson and Kousisis offer a few key takeaways:

–With respect to insider trading, itself a highly complex area of law that is addressed by the wire fraud statute as well as two separate securities fraud statutes (with different elements) in Titles 18 and 15 of the U.S. Code, Chastain creates symmetry with Blaszczak so that any misappropriation case must now rest on information that has commercial value to the entity from which it was misappropriated—regardless of whether that entity is a government agency or a private-sector business. These legal developments will likely give the government pause when charging insider trading cases where the misappropriated information at issue is novel in some respect, which could be particularly useful in cases involving digital assets.