US: Former eBay executive pleads guilty to insider trading charges

Saridakis was a senior executive at GSI Commerce Inc. (GSIC) when he provided material, non-public information regarding eBay’s pending acquisition of GSIC. U.S. District Court Judge Stewart Dalzell scheduled a sentencing hearing for September 19, 2014.

On March 20, 2011, Saridakis, who was privy to discussions of a merger, sent a series of text messages to a Confidential Witness (CW1) that began with the defendant asking if CW1 “...own[ed] our [GSIC] shares?” 

 

CW1 replied, “no, but it’s cheap.” This response led Saridakis to tell CW1 “you should.” CW1 responded with “ok,” to which Saridakis replied, “soon.”

 

 On March 22, 2011, following the receipt of the text messages, while in possession of the inside information, and knowing defendant Saridakis’ position as a senior executive at GSIC, CW1 purchased and caused to be purchased 25,000 shares of GSIC stock on margin for approximately $470,000. 

 

On June 20, 2011, CW1 received $737,500 in exchange for the 25,000 shares of GSIC, equating to an illicit profit of $260,304, as a result of the text messages. Saridakis also shared the same material non-public information with other individuals.

Saridakis faces a maximum possible sentence of 20 years in prison, three years of supervised release, a $5 million fine, and a $100 special assessment.

The case was investigated by the FBI. The case is being prosecuted by Assistant United States Attorney Joel D. Goldstein. Saridakis and others have been charged in a parallel civil matter by the Securities and Exchange Commission.