SpaceX engineer pleads guilty to DOJ insider trading charges – tech2.org

SpaceX engineer pleads guilty to DOJ insider trading charges


SpaceX headquarters in Los Angeles, California.

AaronP / Bauer-Griffin | GC Images | fake images

A SpaceX engineer has pleaded guilty to a Justice Department charge of insider trading, the agency announced Thursday, after using information obtained from the dark web to trade public securities with non-public information.

The Justice Department’s criminal case against James Roland Jones of Hermosa Beach, California, followed an FBI investigation in 2017.

The government’s announcement of the plea deal identified Jones as a SpaceX engineer, although the agency did not specify whether he currently works for the space company and whether he did so at the time of the fraud.

The Securities and Exchange Commission simultaneously accused Jones of “perpetrating a fraudulent plan to sell what he called ‘inside information.’ The SEC did not name SpaceX in its complaint.

SpaceX, the DOJ and the SEC did not immediately respond to CNBC’s requests for comment.

The Justice Department said Jones used the nickname “MillionaireMike” to buy information, such as address, dates of birth and social security numbers, on the dark web. The dark web, as defined by the SEC, “refers to anything on the Internet that is not indexed or accessible through a search engine such as Google.”

Jones then used this information to conduct financial transactions on material non-public information, the DOJ alleges. In April 2017, an undercover FBI agency gave Jones “alleged inside information related to a publicly traded company,” the Justice Department said.

“From April 18, 2017 to May 4, 2017, Jones and a conspirator conducted numerous securities transactions based on this alleged inside information,” the DOJ said.

The SEC charged Jones with anti-fraud violations of federal securities law. Jones agreed to a bifurcated settlement with the SEC and faces a maximum sentence of five years in federal prison under his statement to the DOJ.

“This case shows that the SEC can and will pursue securities law violators wherever they operate, including on the dark web,” said David Peavler, director of the SEC’s Fort Worth regional office, in a statement. .

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