Former Investment Banker Accused of Masterminding Global Insider Trading Network
Federal prosecutors in Boston have unsealed indictments against eight individuals, including former Merrill Lynch banker Samy Fadi Khouadja, for allegedly operating a sophisticated global insider trading ring that generated tens of millions in illegal profits.
The 45-year-old Khouadja, who currently remains at large and is considered a fugitive by the US Justice Department, stands accused of co-leading the elaborate scheme that operated from 2016 to 2024.
The Paris Restaurant Connection
According to court documents, Khouadja left his position at Merrill Lynch in 2014 and subsequently opened Hexagone, a Paris restaurant that has since closed. Prosecutors allege this establishment served as the operational hub where the illegal trading conspiracy was hatched and coordinated.
The indictment reveals that Khouadja and his co-conspirators recruited investment bankers and corporate insiders who were paid substantial sums to provide confidential information about public companies' financial results and upcoming merger activities.
Sophisticated Concealment Methods
The group employed extensive measures to hide their activities from authorities, including using burner phones, coded language, and encrypted messaging applications. Payments for the illegal tips were allegedly processed through cash transfers, shell companies, and fabricated invoices.
In an unusual twist, prosecutors claim the defendants also leaked confidential information to journalists, intending to profit from market movements after the information became public through media reports.
The scheme targeted more than a dozen corporate deals and involved a global network of traders across multiple continents who executed trades based on the stolen confidential information.
International Reach and Co-Conspirators
Alongside Khouadja, prosecutors identified Eamma Safi and Zhi Ge as alleged co-leaders of the international ring. Both men were charged last year, with Safi currently in US custody after pleading not guilty in February. Ge was arrested in Singapore and is currently contesting extradition to the United States.
The Justice Department also charged five additional individuals located in France, Hong Kong, and Singapore who allegedly agreed to trade on the confidential information in exchange for a percentage of the illegal profits. All five remain at large and are considered fugitives.
In a significant development, trader Ronald Cordas has pleaded guilty and is cooperating with authorities after allegedly helping Safi and Ge accumulate approximately $8 million by trading Tiffany & Co. stock ahead of LVMH's acquisition approach.
Previous Legal Troubles in France
This isn't Khouadja's first encounter with insider trading allegations. French authorities had previously charged him in 2018 as part of a separate investigation focusing on suspicious gains by a Geneva-based trader and information leaks from a former consultant at Brunswick Group LLP. That case remains ongoing as of March with no decision made regarding a trial.
Dominique Inchauspé, Khouadja's French attorney, declined to comment immediately, stating he needed to consult with his client first.
The case, officially known as US v. Safi (24-cr-10200), is proceeding in the US District Court for the District of Massachusetts and represents one of the more significant international insider trading prosecutions in recent years.
