SEC v. Jian Wu, No. LR-26398, Southern District of New York (Sept. 11, 2025) — Press Release

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26398 / September 11, 2025 Securities and Exchange Commission v. Wu, No. 1:25-civ-07573 (S.D.N.Y. filed Sept. 11, 2025) Quantitative Model Developer Charged with Defrauding Registered Investment Advisers On September 11, 2025, the Securities and Exchange Commission charged New York resident Jian Wu with orchestrating a scheme to deceive his former employer, Two Sigma Investments, LP and its affiliate, Two Sigma Advisers, LP (together “Two Sigma”), and reap millions of dollars in ill-gotten compensation by manipulating computer-based algorithmic investment models that Two Sigma used to make investment decisions for clients, including decisions to buy and sell securities. The SEC’s complaint alleges that between November 2021 and August 2023, Wu secretly manipulated at least fourteen investment models that he created or helped create, which Two Sigma used to predict the future performance of securities, and which Wu understood Two Sigma used to make investment decisions for clients. According to the SEC’s complaint, Wu misrepresented to Two Sigma that these models were generating unique forecasts when, in fact, Wu made unauthorized and undisclosed changes to those models that caused them to effectively replicate the forecasts of other Two Sigma models. Wu’s unauthorized changes allegedly caused Two Sigma to buy and sell securities for its clients in amounts, concentrations, and frequencies that differed from Two Sigma’s intended strategies, and caused at least $165 million in harm to certain clients, which Two Sigma subsequently repaid. According to the complaint, Wu obtained millions of dollars of ill-gotten gains in incentive compensation as a result of his fraud. The SEC’s complaint, filed in the U.S. District Court for the Southern District of New York, charges Wu with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and seeks injunctive relief, disgorgement and prejudgment interest, a civil penalty, and an order barring Wu from acting as or being associated with an investment adviser. In a parallel action, the U.S. Attorney’s Office for the Southern District of New York announced criminal charges against Wu on September 11, 2025. The SEC’s investigation was conducted by Brian Kudon, David F. Benson, and Brian Fitzpatrick, and supervised by Lee A. Greenwood and Corey Schuster, all of the Enforcement Division’s Asset Management Unit, as well as Christopher M. Colorado, Senior Trial Counsel in the SEC’s New York Regional Office. Alan Lenarcic and Elcin Yildirim of the Division of Examinations’ Quantitative Analytics Unit, Jennifer Moldaver of the Division of Examinations’ Private Funds Unit, and Carol Foehl of the Boston Regional Office assisted with the investigation. The litigation will be led by Messrs. Kudon, Benson, and Colorado, and will be supervised by Jack Kaufman of the New York Regional Office. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation.

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26398 / September 11, 2025 Securities and Exchange Commission v. Wu, No. 1:25-civ-07573 (S.D.N.Y. filed Sept. 11, 2025) Quantitative Model Developer Charged with Defrauding Registered Investment Advisers On September 11, 2025, the Securities and Exchange Commission charged New York resident Jian Wu with orchestrating a scheme to deceive his former employer, Two Sigma Investments, LP and its affiliate, Two Sigma Advisers, LP (together “Two Sigma”), and reap millions of dollars in ill-gotten compensation by manipulating computer-based algorithmic investment models that Two Sigma used to make investment decisions for clients, including decisions to buy and sell securities. The SEC’s complaint alleges that between November 2021 and August 2023, Wu secretly manipulated at least fourteen investment models that he created or helped create, which Two Sigma used to predict the future performance of securities, and which Wu understood Two Sigma used to make investment decisions for clients. According to the SEC’s complaint, Wu misrepresented to Two Sigma that these models were generating unique forecasts when, in fact, Wu made unauthorized and undisclosed changes to those models that caused them to effectively replicate the forecasts of other Two Sigma models. Wu’s unauthorized changes allegedly caused Two Sigma to buy and sell securities for its clients in amounts, concentrations, and frequencies that differed from Two Sigma’s intended strategies, and caused at least $165 million in harm to certain clients, which Two Sigma subsequently repaid. According to the complaint, Wu obtained millions of dollars of ill-gotten gains in incentive compensation as a result of his fraud. The SEC’s complaint, filed in the U.S. District Court for the Southern District of New York, charges Wu with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and seeks injunctive relief, disgorgement and prejudgment interest, a civil penalty, and an order barring Wu from acting as or being associated with an investment adviser. In a parallel action, the U.S. Attorney’s Office for the Southern District of New York announced criminal charges against Wu on September 11, 2025. The SEC’s investigation was conducted by Brian Kudon, David F. Benson, and Brian Fitzpatrick, and supervised by Lee A. Greenwood and Corey Schuster, all of the Enforcement Division’s Asset Management Unit, as well as Christopher M. Colorado, Senior Trial Counsel in the SEC’s New York Regional Office. Alan Lenarcic and Elcin Yildirim of the Division of Examinations’ Quantitative Analytics Unit, Jennifer Moldaver of the Division of Examinations’ Private Funds Unit, and Carol Foehl of the Boston Regional Office assisted with the investigation. The litigation will be led by Messrs. Kudon, Benson, and Colorado, and will be supervised by Jack Kaufman of the New York Regional Office. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York and the Federal Bureau of Investigation.