Last week, a former I.T. professional at law firm Wilson Sonsini Goodrich & Rosati received his sentence for a particularly brazen insider trading case scheme that he carried out by abusing his access to nonpublic information in the law firm’s client-related databases. U.S. District Judge Paul Engelmayer of the SDNY sentenced Dmitry Braverman to two years in prison, noting that Braverman was a "repeated" insider trader who had ignored a huge "wake-up" call to stop his illegal behavior.

The wake-up call Judge Engelmayer was referring to occurred in 2011, while Braverman's insider trading scheme was ongoing. In April 2011, in an extraordinary coincidence, federal prosecutors and the SEC filed high-profile cases against Matthew Kluger, a lawyer at Braverman's law firm, for similarly stealing (and trading on) the firm's nonpublic information. Rather than heeding this “flashing stop sign,” as Judge Engelmayer described it, Braverman simply shifted course. Prosecutors alleged that following Kluger's arrest, Braverman liquidated the securities he had purchased based on the inside information, waited for about 18 months, and then resumed his insider trading in a brokerage account held in the name of a relative living in Russia.  

In November 2014, Braver man pleaded guilty to one count of securities fraud related to his scheme, and admitted that he had made profits of more than $300,000. In handing down the two-year sentence, Judge Engelmayer stated that "it is important when an insider trader gets caught - and a repeated insider trader as here - that a substantial sentence is imposed."

In addition, to settle the SEC's civil case against him, Braverman agreed in June 2015 to pay a total over $506,000 (disgorgement of over $306,000 in illegal gains, prejudgment interest of $9,336.41 and a civil penalty of over $204,000).