SEC charges ex-Goldman compliance analyst with insider trading

According to the SEC’s complaint, filed in the U.S. District Court for the Southern District of New York, Jose Luis Casero Sanchez, a Spanish national, reaped hundreds of thousands of dollars in illegal trading profits. The agency did not identify Goldman Sachs by name but did list some of the firm’s clients whose stocks Sanchez allegedly traded.

Sanchez worked in the control room at Goldman’s office in Warsaw, Poland. In his position, he was entrusted with broad access to material, nonpublic information concerning pending and potential transactions in which the firm was involved.

“Sanchez was given this broad access to highly sensitive information so that, as a compliance analyst, he could assist the investment bank’s efforts to, among other things, monitor and control the flow of material, nonpublic information between the ‘private’ and ‘public’ sides of the firm and prevent and detect employee insider trading,” the complaint stated.

However, between September 2020 and May 2021, Sanchez allegedly “access[ed] and misappropriate[ed] sensitive information concerning at least 45 mergers and acquisitions, tender offers, financing transactions, and other significant corporate events involving the investment bank’s clients and/or potential clients.” He then unlawfully traded based on that information.

Sanchez allegedly attempted to avoid detection by making small trades in four U.S.-based brokerage accounts held in the name of his parents: Jose Luis Casero Abellan and Maria Isabel Sanchez Gonzalez. Through this scheme, Sanchez generated at least $471,700 in illicit profits, according to the SEC.

“Despite Sanchez’s alleged efforts to avoid detection by limiting the size of his trades and using four different accounts to trade under his parents’ names, the SEC’s keen analysis stitched together this pattern of suspicious trading and exposed gross violations of duty by a compliance professional who exploited the sensitive information he was hired to protect,” said Joseph Sansone, chief of the SEC’s Market Abuse Unit, in a press release.

Sanchez was with Goldman from September 2019 until resigning in May 2021, when the bank interviewed him concerning suspicious activity.

Sanchez is charged with violating the antifraud provisions of the federal securities laws. The SEC is seeking a permanent injunction, disgorgement, prejudgment interest, and a civil penalty in the case.

The SEC obtained an emergency court order to freeze Sanchez’s assets. The agency also charged Sanchez’s parents as relief defendants.