A McKinsey partner was arrested Wednesday after being criminally charged with insider trading forward of Goldman Sachs’ current $2.2 billion acquisition of fintech lender GreenSky.
Puneet Dikshit, a 40-year-old McKinsey partner, exploited info he gained about his shopper Goldman Sachs’ pending takeover to purchase worthwhile name choices in GreenSky, in accordance to a complaint unsealed Wednesday in federal court docket.
Dikshit, who had a lead function advising Goldman on the deal, dabbled with buying small quantities of choices within the months forward of the transaction, authorities alleged. After studying {that a} deal was imminent, nonetheless, Dikshit purchased about 2,500 name choices within the two days earlier than the Sept. 15 announcement, in accordance to the grievance. He in the end netted about $450,000 via trades made in accounts at an unnamed commission-free brokerage, the U.S. alleged.
It is the most recent instance by which a extremely compensated skilled allegedly succumbed to the temptation to commerce off materials private info. Former McKinsey CEO Rajat Gupta was convicted of insider trading in 2012 and spent two years in jail. Companions on the consultancy could make greater than $1 million in complete annual compensation, in accordance to recruiters.
Whereas Dikshit would be the most high-profile particular person ensnared within the GreenSky episode, it is seemingly that others had entry to deal info and traded off it, in accordance to individuals with data of the state of affairs. In September, CNBC was first to report that suspicious trades had been made in GreenSky choices within the weeks forward of the deal.
Dikshit faces two counts of securities fraud, every with a most sentence of 20 years in jail, the Division of Justice mentioned Wednesday in a launch.
He was fired by his employer, McKinsey mentioned in a press release supplied to CNBC. Dikshit’s attorneys at Kramer Levin did not instantly reply to requests for remark.
“We have terminated the employment of a partner for a gross violation of our policies and code of conduct,” McKinsey mentioned in a press release. “We have zero tolerance for the appalling behavior described in the complaint, and we will continue cooperating with the authorities.”
Goldman mentioned it was “deeply disappointed by the insider trading allegations” and can be cooperating with the investigation, a spokesperson mentioned.
Regardless of being a senior advisor on monetary transactions, Dikshit’s browser historical past on McKinsey computer systems signifies he had fundamental questions as he researched his trades, authorities alleged.
On Sept. 14, Dikshit Googled “what happens to options when company is acquired,” in accordance to the grievance.
Whereas Dikshit failed to get preapproval for the GreenSky trades, in late September, after CNBC publicized the suspicious exercise, he tried to get his trades retroactively accredited, the grievance detailed.
The ultimate Google search listed within the grievance: In early October, Dikshit ran searches associated to the insider trading conviction of Rajat Gupta.
This story is creating. Please test again for updates.
With reporting from CNBC’s Jim Forkin and Dan Mangan.