Fifteen individuals, including lawyers from prominent US firms, have pleaded not guilty to charges stemming from an alleged decade-long insider trading scheme. The defendants appeared in a Boston federal court on Monday, facing securities fraud and other related charges. Prosecutors allege the ring, operating since 2014, generated tens of millions of dollars through tips concerning nearly 30 corporate mergers and acquisitions. In total, 30 people have been charged in connection with the sophisticated operation, orchestrated by Nicolo Nourafchan and personal injury attorney Robert Yadgarov.
Nicolo Nourafchan, a lawyer who worked at Sidley Austin, Latham & Watkins, and Goodwin Procter, is accused of feeding inside information to Yadgarov and others about impending corporate transactions. These tips were allegedly exchanged for kickbacks derived from trading profits, beginning shortly after Nourafchan’s graduation from Yale Law School. The scheme reportedly involved recruiting other attorneys, including one from Wachtell, Lipton, Rosen & Katz, and another from Weil, Gotshal & Manges and Willkie Farr & Gallagher, to provide further confidential information. One such recruit, Gabriel Gershowitz, secretly pleaded guilty last year and is now a cooperating witness.
Lorenzo Nourafchan, Nicolo’s brother and the founder of a fractional CFO and accounting firm, also entered a not guilty plea. His firm provides chief financial officer services to companies on a part-time basis and offers general accounting services. A US Magistrate Judge warned Lorenzo about a potential conflict of interest regarding his payment of his brother’s legal fees. Defence counsel for Nicolo Nourafchan affirmed his client’s innocence, promising a “vigorous and compelling defence.” Joseph Suskind, an insurance adjusting business owner, also pleaded not guilty, with his lawyer asserting innocence and anticipating trial. Eight other guilty pleas connected to the case were unsealed earlier this month.
