Earlier today, a federal indictment was unsealed in Brooklyn, charging broker David Cooper and traders Randy Grewal, John Lowe, and Richard Ringel with conspiracy to commit securities fraud and securities fraud. The charges relate to their alleged involvement in an insider trading scheme. Cooper was arrested in Westchester and is set to be arraigned before United States Magistrate Judge Joseph A. Marutollo. Grewal was apprehended in Anthem, Arizona, while Lowe and Ringel were detained in Stewart and Boca Raton, Florida. Their arraignments will occur later in the Eastern District of New York.
The arrests and charges were announced by Judy Philips, Acting Attorney for the United States for the Eastern District of New York; William S. Walker, Special Agent in Charge of Homeland Security Investigations New York (HSI); and Brendan Donahue, Acting Inspector in Charge of the United States Postal Inspection Service (USPIS), New York Division.
"As alleged, the defendants exploited their access to inside information for years to gain an unfair advantage over the investing public for their own personal gain," stated Acting Attorney Philips. "The arrests and indictment demonstrate that this Office will protect the integrity of the securities markets and aggressively prosecute those who engage in insider trading."
Philips also acknowledged significant cooperation from the U.S. Securities and Exchange Commission's New York Regional Office and the Financial Industry Regulatory Authority during the investigation.
"Those who participate in illicit trading schemes undermine our U.S. Securities and Exchange Commission laws and regulations with selfish ambition," stated HSI Special Agent Walker. "HSI continues to work side-by-side with our law enforcement partners to ensure fraudsters who manipulate our legal financial systems are identified and prosecuted to the fullest extent."
"This is a case of pure greed where individuals lied, obtained information illegally, and used it solely for their own personal financial gain," said USPIS Acting Inspector Donahue.
According to allegations within the indictment, between January 2018 and May 2024, Cooper conspired with others to obtain material non-public information (MNPI) about upcoming secondary stock offerings for illegal trading purposes. This MNPI included details such as company identity issuing secondary offerings, deal timing, structure, pricing information—all obtained through Cooper's role at a broker-dealer involved with investment banks underwriting these offerings.
Cooper allegedly breached confidentiality agreements by sharing MNPI with Lowe, Ringel among others intending short sales prior public announcements; enticing Broker-Dealer customers including Lowe/Ringel into buying shares ensuring compensation from underwriters alongside personal gains exceeding $1 million on illegal profits made via short sales ahead secondary offerings based upon shared MNPI passed onto Grewal too according evidence collected wiretaps revealing numerous transactions throughout period mentioned above specifically targeting companies like Chicken Soup Soul Entertainment Inc., Revelation Biosciences Inc., Tivic Health Systems Inc..
Fraudulent activities detailed include specific trades conducted around March 30th CSSE offering involving both Ringel & Co-Conspirator #1 passing vital data onto Lowe leading further exchanges benefiting all parties involved similarly repeated instances occurred surrounding REVB/TIVC deals across February timeframe where again crucial insights were relayed back forth enabling successful speculative actions yielding substantial returns each occasion described thoroughly within documentation presented court proceedings currently underway against accused individuals facing potential sentences reaching up twenty-five years imprisonment should convictions follow ongoing litigation process overseen Business/Securities Fraud Section Criminal Division Long Island office spearheaded Assistant US Attorneys Jessica K Weigel Sophia M Suarez Adam R Toporovsky supported Paralegal Specialist Liam McNett handling prosecution efforts moving forward case docketed under E.D.N.Y No:25-CR-10(DG).