A sprawling federal insider-trading prosecution took a major step forward in Boston on Monday as 15 defendants, including lawyers and financial professionals, pleaded not guilty to allegations that they participated in a long-running scheme built around confidential merger information.
At the center of the case is Nicolo Nourafchan, an attorney who previously worked at several prominent law firms. Federal prosecutors allege he helped funnel highly sensitive information about corporate takeovers and mergers to a network of traders over the course of roughly a decade. He appeared in court and denied charges that include securities fraud.
Authorities say the alleged operation stretched back to 2014 and ultimately involved information tied to nearly 30 corporate transactions. According to prosecutors, the scheme generated tens of millions of dollars in illicit trading profits and was coordinated by Nourafchan alongside personal-injury attorney Robert Yadgarov, who also entered a not-guilty plea.
Among those appearing in court was Lorenzo Nourafchan, Nicolo’s brother and the founder of a financial consulting and accounting business. Court proceedings also examined an arrangement under which Lorenzo is covering Nicolo’s legal expenses, prompting judicial concerns about the possibility of conflicting interests as the case moves ahead.
Nicolo Nourafchan’s legal team firmly rejected the accusations, signaling an aggressive defense strategy and maintaining that he is innocent of all allegations.
Federal investigators contend that while employed at major law firms, Nourafchan gained access to confidential information concerning pending mergers and acquisitions. Prosecutors claim he passed those details to associates who then traded on the information before deals became public. In return, they allege, he received a share of the profits.
The government further alleges that additional attorneys were brought into the network, providing access to a broader stream of confidential corporate information. One former attorney linked to the investigation has already admitted wrongdoing and is cooperating with authorities.
The broader probe has so far resulted in charges against 30 individuals. Nine people connected to the investigation have previously entered guilty pleas, several of which remained under seal until the government publicly unveiled the case earlier this year.
Prosecutors also claim members of the alleged network used coded language when discussing merger intelligence, including references tied to cultural and religious themes, in an effort to disguise the nature of their communications.
One defendant, Florida-based insurance adjuster Joseph Suskind, is accused of trading on information related to corporate acquisition deals involving software company SailPoint and robotics manufacturer iRobot. His attorney dismissed the allegations and argued that the government’s public narrative would ultimately be tested against the evidence presented in court.
With multiple defendants contesting the charges and several cooperating witnesses expected to testify, the case is shaping up to be one of the most significant insider-trading prosecutions in recent years. Federal prosecutors maintain that the alleged network exploited privileged legal access to profit from confidential corporate information, while the defendants insist they will fight the accusations at trial.
