By Maria Armental
Two New York men are accused of making more than $900,000 in an insider-trading scheme, using confidential information on publicly traded companies from the S&P Dow Jones Indices, the company that manages the S&P 500 benchmark and other indexes.
Yinghang "James" Yang, a senior index manager, and his friend, Yuanbiao Chen, a manager at a sushi restaurant, were accused of running the scheme for several months last year, according to documents filed in Brooklyn federal court. Mr. Yang was charged with securities fraud and has been arrested.
The two Queens men stopped in October 2019 after Mr. Chen's brokerage firm asked some questions about his occupation and sources of money, according to a complaint filed by the Securities and Exchange Commission against the two men.
Though the documents don't refer to Mr. Yang's company by name, they refer to his LinkedIn profile, where he identifies himself as a senior index manager at S&P Dow Jones Indices and member of the index committee.
S&P said Mr. Yang has been suspended, and said it was cooperating with the authorities.
"The allegations describe behavior that is contrary to our Company's code of conduct and deeply held ethical values," said April Kabahar, a spokeswoman for the company.
S&P Dow Jones Indices publishes the Dow Jones Industrial Average and other indexes. News Corp's Dow Jones & Co., publisher of The Wall Street Journal, no longer has an ownership stake in the index company.
Messrs. Yang and Chen couldn't be immediately reached for comment.
The authorities accused the men of trading on information about index changes before the information was released to the public.
For example, the authorities accuse the men of trading on T-Mobile US Inc. on July 9, 2019 -- just hours before S&P said that T-Mobile would join the S&P 500.
Similarly, on Sept. 26, 2019 -- hours before Las Vegas Sands Corp.'s being added to the S&P 500 was publicly announced -- the two men traded on the company at a profit of more than $300,000, according to the documents.
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