A junior analyst at RBC Capital Markets in New York has been arrested and charged with insider trading barely a year after joining the bank from college.
The Manhattan US attorney’s office accused Bill Tsai of buying options in Electronics for Imaging ahead of its $1.6bn acquisition by Siris Capital in April. The private equity firm had used financing from the bank to secure the deal.
“His profits were not the result of trading acumen, diligent research, or blind luck, but rather, as alleged, the product of theft of confidential information from his employer,” said Geoffrey Berman, the US attorney for the southern district of New York, in a statement on Monday.
Mr Tsai was arrested on Sunday and was due to appear in court on Monday afternoon. He allegedly made profits of almost $100,000 by buying call options in EFI before the announcement of the Siris deal and subsequently selling them.
The Securities and Exchange Commission also announced civil charges against the 23-year-old banker on Monday.
He had interned at RBC in the summer of 2017 and joined the bank in July 2018 after graduating from NYU Stern School of Business, according to his LinkedIn.
Mr Tsai could not be immediately reached for comment. The SEC said he had no known attorney.
Mr Tsai was the student body president of the undergraduate business school at NYU Stern in 2018, according to his LinkedIn. In a 2017 interview posted on the school’s website, he was asked what advice he had for new students.
“Hold on to your values. I think the biggest thing is that you learn so many things in school. That’s a beautiful part of the school, but it’s to figure out what you believe in. And then, when you meet all these people outside, you still stay true to yourself. You stay humble, you stay eager,” he said.
The Department of Justice and SEC alleged he traded through a brokerage account he had failed to disclose to RBC in violation of its policies.
A RBC spokesperson said Mr Tsai had been suspended: “RBC has a zero-tolerance approach to any breach of the law or our code of conduct. We have cooperated fully with law enforcement as it relates to this matter.”
