SEC v. Robert Brian Thompson, No. LR-26172, Eastern District of Virginia (Nov. 19, 2024) — Press Release

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26172 / November 19, 2024 Securities and Exchange Commission v. Robert Brian Thompson, No. 3:24-cv-00800-MHL (E.D. Va., filed Nov. 8, 2024) SEC Charges Richmond Federal Reserve Banking Supervisor with Insider Trading On November 8, 2024, the Securities and Exchange Commission filed insider trading charges against Robert Brian Thompson, a long-time banking supervisor and examiner at the Federal Reserve Bank of Richmond, for allegedly using material nonpublic information to trade in stock and options of two publicly traded banks that were under his supervisory purview. According to the SEC's complaint, in October 2023, Thompson, of Moseley, Virginia, obtained a preview of an upcoming positive earnings announcement by one of the banks in his supervisory portfolio. Based on that information, Thompson allegedly bought $678,000 worth of the bank's stock hours before the scheduled announcement, which resulted in $79,346 of ill-gotten profits. The SEC's complaint further alleges that, in January 2024, Thompson learned that a different bank in his supervisory portfolio would be disclosing unexpected loan losses worth hundreds of millions of dollars as part of an upcoming earnings announcement. Thompson allegedly leveraged that material nonpublic information to buy thousands of options on the bank's stock two days before the scheduled announcement, which led to $505,527 of ill-gotten profits. The SEC's investigation originated from the Enforcement Division's Market Abuse Unit, which used Consolidated Audit Trail (CAT) data to analyze Thompson's suspicious trading activity. The SEC's complaint, filed in the U.S. District Court for the Eastern District of Virginia, charges Thompson with violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks a final judgment ordering Thompson to pay disgorgement with prejudgment interest and civil penalties, and enjoining him from committing future violations of the charged antifraud provisions. Thompson has consented to the entry of an injunction, with disgorgement and civil penalties, if any, to be determined later by the Court. The settlement is subject to Court approval. Earlier today, Thompson pleaded guilty to criminal charges in a parallel action brought by the U.S. Department of Justice's Criminal Division Fraud Section and the U.S. Attorney's Office for the Eastern District of Virginia. The SEC's investigation was conducted by Derek M. Schoenmann, David Bennett, John S. Rymas, and Lindsay S. Moilanen of the SEC's Enforcement Division's Market Abuse Unit and supervised by Market Abuse Unit Chief Joseph G. Sansone. The SEC's litigation is being led by Mr. Schoenmann and Timothy K. Halloran and supervised by Preethi Krishnamurthy. The SEC appreciates the assistance of the Department of Justice Criminal Division, the U.S. Attorney's Office for the Eastern District of Virginia, and the Federal Reserve Board's Office of the Inspector General.

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26172 / November 19, 2024 Securities and Exchange Commission v. Robert Brian Thompson, No. 3:24-cv-00800-MHL (E.D. Va., filed Nov. 8, 2024) SEC Charges Richmond Federal Reserve Banking Supervisor with Insider Trading On November 8, 2024, the Securities and Exchange Commission filed insider trading charges against Robert Brian Thompson, a long-time banking supervisor and examiner at the Federal Reserve Bank of Richmond, for allegedly using material nonpublic information to trade in stock and options of two publicly traded banks that were under his supervisory purview. According to the SEC's complaint, in October 2023, Thompson, of Moseley, Virginia, obtained a preview of an upcoming positive earnings announcement by one of the banks in his supervisory portfolio. Based on that information, Thompson allegedly bought $678,000 worth of the bank's stock hours before the scheduled announcement, which resulted in $79,346 of ill-gotten profits. The SEC's complaint further alleges that, in January 2024, Thompson learned that a different bank in his supervisory portfolio would be disclosing unexpected loan losses worth hundreds of millions of dollars as part of an upcoming earnings announcement. Thompson allegedly leveraged that material nonpublic information to buy thousands of options on the bank's stock two days before the scheduled announcement, which led to $505,527 of ill-gotten profits. The SEC's investigation originated from the Enforcement Division's Market Abuse Unit, which used Consolidated Audit Trail (CAT) data to analyze Thompson's suspicious trading activity. The SEC's complaint, filed in the U.S. District Court for the Eastern District of Virginia, charges Thompson with violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks a final judgment ordering Thompson to pay disgorgement with prejudgment interest and civil penalties, and enjoining him from committing future violations of the charged antifraud provisions. Thompson has consented to the entry of an injunction, with disgorgement and civil penalties, if any, to be determined later by the Court. The settlement is subject to Court approval. Earlier today, Thompson pleaded guilty to criminal charges in a parallel action brought by the U.S. Department of Justice's Criminal Division Fraud Section and the U.S. Attorney's Office for the Eastern District of Virginia. The SEC's investigation was conducted by Derek M. Schoenmann, David Bennett, John S. Rymas, and Lindsay S. Moilanen of the SEC's Enforcement Division's Market Abuse Unit and supervised by Market Abuse Unit Chief Joseph G. Sansone. The SEC's litigation is being led by Mr. Schoenmann and Timothy K. Halloran and supervised by Preethi Krishnamurthy. The SEC appreciates the assistance of the Department of Justice Criminal Division, the U.S. Attorney's Office for the Eastern District of Virginia, and the Federal Reserve Board's Office of the Inspector General.