Federal prosecutors charged a former employee at Goldman Sachs Group Inc. and Blackstone Inc. with securities fraud for allegedly tipping his friends to more than half a dozen deals.
Anthony Viggiano, 26, tipped two friends to deals that Viggiano learned about at his time at the two Wall Street firms, the Justice Department and the Securities and Exchange Commission said Thursday. The charges detail how the group made more than $400,000 on trades passed around on messaging apps like Signal as well as Xbox chat.
“Viggiano betrayed the trust of his employers by tipping his friends,” Damian Williams, the US Attorney for the Southern District of New York, said in a statement. “No matter how evasive insider traders’ conduct, or the lengths gone to hide their offenses, this Office will track down and prosecute those who attempt to cheat the system.”
The latest complaint marks at least the fifth incident involving a Goldman Sachs employee in recent years. Last year, a Goldman banker was accused of passing stock tips to a squash buddy. And that followed a trio of insider trading cases involving Goldman staffers through a span of 18 months ending in October 2019.
Both Goldman and Blackstone said they are cooperating with prosecutors.
“The allegations in the indictment, if true, are egregious,” said Mary Athridge, a spokeswoman for Goldman Sachs. “The firm has zero tolerance for this kind of behavior.”
Viggiano worked in the asset and wealth management division, according to the indictment. He had previously resigned from a post at Blackstone, after the firm discovered he had been trading without pre-clearance.
“We make crystal clear to every employee through our extensive compliance and training procedures that we have absolutely zero tolerance for the behavior alleged,” Matt Anderson, a Blackstone spokesman, said in a statement. “This individual was a junior analyst in a non-investment, finance function who was briefly employed for less than seven months and left two years ago.”
His childhood friend, Christopher Salamone, pleaded guilty on Sept. 21 and is cooperating with prosecutors, the Justice Department said. A lawyer for Viggiano declined to comment. A lawyer for Salamone didn’t immediately respond to a message.
Signal, Xbox
The SEC alleged that Viggiano sent tips about upcoming deals involving companies including, American International Group Inc., Harmony Biosciences Holdings Inc., and CDK Global Inc., to his friends Stephen Forlano and Salamone. Those two allegedly traded on the tips, making hundreds of thousands of dollars in profits.
A lawyer for Forlano said his client denies the allegations.
Viggiano tried to cover his tracks by passing tips to Salamone, asking him to download the encrypted messaging app Signal to communicate and then used the disappearing message feature. He also supplied Salamone with cash for trading, the SEC said.
Salamone made $322,000 from the tips, gave Viggiano $35,000 in cash, and planned to hand over more money, the SEC said. The former Goldman employee had suggested that the illegal trading profits be split 50-50.
The other friend Viggiano tipped — Forlano — not only traded off that information, but also passed it to five friends and family members. Viggiano and Forlano attended college together, the DOJ said.
Salamone confronted Viggiano on a call in June, asking if there was information showing he gave tips to Forlano. Salamone was recording the conversation.
“Nah. Nah,” Viggiano replied. “Because similar to you... Signal, or like XBOX 360 chat, there’s no tracing that. Good luck ever finding that.”
--With assistance from Jenny Surane.
(Adds additional details throughout. A previous version of the story had been corrected to reflect the nature of his departure from Blackstone.)