Former Apple lawyer Gene Levoff has pled guilty to insider trading charges, for what prosecutors called a five-year scheme to trade ahead of the tech giant’s quarterly earnings announcements, reports CNBC.
Levoff allegedly exploited his roles as corporate secretary, head of corporate law and co-chair of a committee that reviewed drafts of Apple’s results to generate $604,000 of illegal gains on more than $14 million of trades from 2011 to 2016.
In April 2020, The U.S. Securities and Exchange Commission (SEC) charged Levoff, Apple’s former vice president of corporate law with insider trading in February 2019. Insider trading is the illegal practice of trading on the stock exchange to one’s own advantage through having access to confidential information.
However, Levoff said the charges were unconstitutional because his actions aren’t expressly prohibited by any one criminal law.
Before his termination in September 2018, he was “responsible for Apple’s compliance with securities laws.” In a lawsuit, the SEC said that, on more than one occasion, he disobeyed the company’s “blackout” period for stock transactions, selling or buying stock worth tens of millions of dollars, according to the SEC.
“Levoff also had a previous history of insider trading, having traded on Apple’s material nonpublic information at least three additional times in 2011 and 2012. For the trading in 2015 and 2016, Levoff profited and avoided losses of approximately $382,000,” the SEC complaint said.. It adds that the attorney’s position at Apple granted him insider access to not-yet-public earnings results and briefings on iPhone sales.
From 2008 to 2013, he was director of Corporate Law at Apple. He also served on Apple’s Disclosure Committee from September 2008 to July 2018
According to the SEC complaint, Levoff was responsible for Apple’s compliance with securities laws, including providing legal advice in connection with the tech giant’s SEC filings and financial reporting, and for managing Apple’s corporate subsidiary structure.
He also served as a corporate officer of every major Apple subsidiary. Ironically, Levoff was responsible for ensuring compliance with the company’s insider trading policies.