The Securities and Exchange Commission has filed an action against Gene Daniel Levoff, who was Apple's senior corporate director until September 2018. Levoff is accused of using his position to traffick Apple shares.
Levoff was a member of Apple's Disclosure Committee – one of the individuals who reviewed the company's quarterly financial statements prior to its release. The SEC claims that it has used nonpublic information that it has acquired as part of the committee to keep Apple's businesses informed of Apple shares. In July 2015, he learned, for example, that Apple would miss the estimates of the analyst for iPhone sales. When Apple released its quarterly earnings report, between July 17 and July 21, it sold almost its entire share of Apple's stock worth nearly $ 10 million. Apple's share price fell more than 4 percent as the news broke, a sale that resulted in a loss of around $ 345,000.
The SEC claims that Levoff made a profit of $ 245,000 between 2011 and 2012 and avoided losses of $ 382,000 in 2015 and 2016.
Apple fired Levoff last year after conducting an internal investigation at the request of the authorities. During his career at Apple, he was one of the companies responsible for complying with the company's insider trading guidelines. In 2015, he even implemented an update to the policy. According to the SEC's file, Levoff sent an e-mail to employees three times in 2010 and 2011 to remind them that the company had a lock-up period and was barred from trading in Apple shares. Two of these e-mails were "just ahead" of his 2011 insider deal.
One of these emails contained the following reminder:
Remember, whether or not you are authorized to be in an open trade window, if you know if you have access to material information that is not publicly available
The SEC demands from Levoff a sum equal to the profits made and the losses avoided in the last five years, along with a threefold penalty. The agency also demands that it be prohibited from serving as a senior executive or director of a public company. At the same time, the US attorney filed a lawsuit in Newark, New Jersey, with a maximum sentence of 20 years and a $ 5 million fine.