Former Lazard banker accused of insider trading

AP News
Posted: Dec 16, 2009 8:55 PM

A former Lazard Freres banker was charged Wednesday with insider trading.

Federal prosecutors in San Francisco accused Adnan Zaman of passing along confidential information to friends about clients' merger plans.

In addition, the Securities and Exchange Commission filed a civil lawsuit against Zaman and three others who authorities say were involved in the insider trading scheme that began in 2006 and continued into 2007.

The SEC said Zaman and former TPG Capital associate Vinayak Gowrish received kickbacks from their friends, Pascal Vaghar and Sameer Khoury, in exchange for information on mergers.

Zaman, Vaghar and Khoury have offered to settle the charges by agreeing to injunctions and to make restitution, and Zaman has agreed to be barred from working for any brokerage firm.

The information was allegedly used to buy stocks and options. The SEC says the four made a combined $500,000 in profits.

The SEC is seeking restitution of allegedly illegal profits and civil penalties against Gowrish. He is disputing the charges.

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"Mr. Gowrish fully denies these allegations and intends to vigorously defend the case brought by the SEC, and demonstrate that he did not violate the securities laws and was not part of any trading scheme," the law firm representing Gowrish, Foley & Lardner, said in a statement.

Zaman's lawyer declined to comment. Khoury's attorney noted that her client has settled with the SEC. Vaghar's lawyer didn't immediately return phone calls.