May 12 Two former U.S. sales directors at chipmaker Qualcomm Inc have been charged with insider trading, according to an indictment unsealed on Monday.
The indictment alleges that Derek Cohen and Robert Herman, former directors of Qualcomm's North America sales department, traded on information they learned in 2011 while employed at Qualcomm. The indictment alleges the men learned that Qualcomm was about to acquire Atheros Communications Inc, then a publicly traded technology company headquartered in California.
Cohen and Herman, according to the indictment, placed more than $500,000 in trades on various Atheros securities issued one day before Qualcomm officially announced the acquisition.
After the news became public, Cohen and Herman sold the securities, which earned them a total profit of nearly $230,000, according to the indictment.
Cohen, who was arrested on Saturday, pleaded not guilty at his arraignment on Monday in Los Angeles federal court, according to government prosecutors. Herman remains at large.
Cohen and Herman also face a parallel civil action by the U.S. Securities and Exchange Commission. Cohen's lawyer was not available for comment and Herman's lawyer could not be reached for comment. (Reporting by Andrew Longstreth in New York; Editing by Lisa Shumaker)