A former Morgan Stanley broker was sentenced to 18 months in prison for his role in a multi-million dollar insider trading scheme, according to federal prosecutors.
Michael Siva, who had
Siva, 57, of Morristown, New Jersey, had been registered with Morgan Stanley from 1996 until his termination in August 2017 from the firm for allegedly engaging in insider trading, according to a note from the wirehouse on
From August 2013 through May 2017, Siva and his alleged co-conspirators made $5 million in illicit profits off misappropriated information originally provided by an investment banker, Daniel Rivas, according to federal prosecutors.
Terri Kallsen will precede him next year as chair of the Board of Directors; Seay will take over that role in 2027.
The popular industry recruiting and retention barometer provided another window into the challenges facing LPL Financial with its latest major acquisition.
The Wall Street powerhouse has built its wealth division in large part through big deals but is not "looking to make acquisitions just for the sake of it, " said CEO Ted Pick.
Rivas was a technology consultant at an investment bank where he used the bank’s internal proprietary system to gain access to material, nonpublic information about potential and unannounced M&A deals, according to prosecutors. Rivas and another individual, James Moodhe, pleaded guilty and cooperated with investigators, prosecutors say. Authorities did not name the investment bank where Rivas worked.
Rivas passed on tips to Moodhe, the father of a woman he was dating at the time, and other individuals, prosecutors say. Moodhe, in turn, passed these on to Siva who used the tips to place trades in his clients’ brokerage accounts, as well as on his own behalf, according to prosecutors.
“Siva committed insider trading to make himself look like a talented stock selector,” U.S. Attorney Geoffrey Berman said in a statement.
To avoid detection, Siva and Moodhe used code phrases on the telephone or met in person at diners outside of New York, according to authorities. Siva also told Moodhe to mark trades “solicited” in his firm’s online trading system “so that it would appear that Siva had directed the trades as opposed to the suggestion coming from Moodhe,” prosecutors say.
In addition to illicit profits he earned off his own trades, Siva also earned commissions off trades he placed in client’s brokerage accounts, according to authorities.
The U.S. Attorney’s office credited the FBI and the SEC for their assistance in investigating the case.
The SEC, which is pursuing a separate civil case against Siva,
In addition to prison time, Siva was also sentenced to two years of supervised release and ordered to forfeit $35,000.
Attorneys representing Siva and Rivas could not be reached for comment. An attorney representing Moodhe declined to comment on the case.
