- Former Coinbase (COIN) product manager Ishan Wahi has pleaded not guilty to federal insider trading charges.
- The SEC has charged Ishan Wahi with using a foreign phone number to make calls and send texts containing insider trade information.
- The Department of Justice is pursuing a second cryptocurrency-related insider trading prosecution.
Ishan Wahi is accused of telling his brothers Nikhil Wahi and Sameer Ramani which cryptocurrency assets the exchange would list next before the listing took place.
The three were charged by the U.S. Securities and Exchange Commission (SEC) in connection with identical insider trading claims.
Ishan Wahi, an Indian national in the US on a work visa, is accused by the SEC of using an international phone number to communicate insider trading information through calls and texts.
According to the Justice Department, the defendants gained up to $1.5 million through the conspiracy when Ishan Wahi reportedly exchanged information regarding at least 14 separate Coinbase listings, however, the SEC estimated that the amount was more likely closer to $1.1 million.
Before the announcements of Coinbase listings, Nikhil and Ramani concealed their cryptocurrency purchases by using accounts at centralized exchanges maintained in other people’s names. They also used a variety of anonymous Ethereum blockchain wallets to move money, cryptocurrencies, and the proceeds of their plan.
The Department of Justice is pursuing its second insider trading case involving cryptocurrency.
The SEC listed nine tokens as securities in the proceedings, though without penalizing the issuers or Coinbase for listing them, which has also drawn attention to the matter.
According to the indictment, the Wahi brothers and Ramani allegedly “made extensive steps to prevent identification from law enforcement” by moving their cryptocurrency around various Ethereum wallets, even wallets that were registered in other people’s names.
Ishan Wahi allegedly “bought a one-way airline ticket to a foreign country in an unsuccessful attempt to depart the United States,” according to the Justice Department’s indictment.