A North Carolina man who formerly managed a Chicago investment research firm has pleaded guilty to securities fraud.
Jason Napodano, 43, pleaded guilty to one count of securities fraud Wednesday before U.S. District Judge Robert M. Dow, according to the FBI.
Securities fraud is punishable by up to 20 years in prison, but based on Napodano’s offense and criminal history, the government will likely seek a sentence of 12 to 18 months, according to court documents.
Napodano, a former managing director of a Chicago investment research firm, used “material, non-public information” he learned while conducting equity research about companies to buy stock in those companies, prosecutors said. He then sold that stock after his reports were released and the stock prices rose, netting a profit of about $143,000.
In what prosecutors are calling a related case, 43-year-old Bilal Basrai, a former managing director of a Chicago investment banking firm, also used non-public information to earn $37,157 from buying and selling stock in three companies, according to the FBI.
Napodano’s scheme lasted from October 2012 to May 2015, while Basrai’s scheme spanned January to July of 2014, the U.S. attorney’s office said. Both men were charged on Sept. 26.
Basrai, of Naperville, also pleaded guilty to a single count of securities fraud on Oct. 6, according to court records.