California has seen its fair share of white collar crime accusations. While some of these accusations are certainly true, there are plenty that are unequivocally false. Oftentimes, the very entities that accuse others of scheming for their own personal gain do this themselves by seeking financial compensation for a crime that has not even been committed.
This article seeks to explore a case that has captured the state’s attention – the insider trading case of a popular California executive. Okabe & Haushatler is a law firm operating out of Beverly Hills, eager to offer support for those convicted of white collar crimes while bringing the penalties of committing such an act to light.
Mark A. Loman was an executive of Hawthorne-based company OSI Systems Inc. He was convicted of insider trading and securities fraud, landing him 35 months in federal prison in addition to a hefty fine. Loman traded in options contracts, a high-stakes, high-rewards style of trading that he was able to inform via his knowledge on his own company’s fiscal performance and business transactions.
The Hermosa Beach executive was sentenced by Judge Dale S. Fisher, a United States District Judge for the Central California region. In the final hours of the 10-day case, he stated that Loman “betrayed his employer and the market.” Loman was ordered to pay a $600,000 fine for his actions, a fair punishment for his motivation by greed, according to the District Judge.
Loman was the vice president (VP) of finance and the corporate controller for OSI Systems Inc. OSI is a manufacturing company that specializes in healthcare and electronics. Loman started working for the company in 2006, but departed from his post there in 2018. His job duties included responsibility for compiling and internally reporting the company’s financial performance.
Loman had extended knowledge on his company’s revenue and earnings, even receiving confidential information that the company was fiscally underperforming. This would lead the VP to purchase numerous options contracts to profit from when the stock price fell in December of 2015, strategically doing so before the company’s underperformance in the second financial quarter of 2016 was announced to the public. This act would lead Loman to gain $355,000 in profits when the company’s stock fell around 30% of its original value.
In another trade, Loman made around $120,000 by selling his shares in a company that OSI had targeted for acquisition. He made around $475,000 through this insider trading scheme – one that came to a halt in July of 2019 when the Securities and Exchange Commission (SEC) filed a lawsuit against Loman.
This story not only highlights the dangers of insider trading but the importance of having a reputable legal team on your side if you are convicted of doing so. If you are in need of San Francisco or Beverly Hills white collar crime defense attorneys, please reach out to Okabe & Haushalter as soon as possible by calling 310-430-7799 or clicking here to fill out an online contact form.