Executive Convicted Of $1.6 Billion Insider Trading On Medical Firm Buyout

An executive at a medical device company has been convicted in Minnesota of insider trading in connection with negotiations for the acquisition of the firm, valued at $1.6 billion, according to federal prosecutors, as reported by the Associated Press (AP).

Medtronic announced the completion of its acquisition of Mazor Robotics on December 19, 2018. I Photo: Tony Webster Flickr

Doron Tavlin, a former vice president for business development at Mazor Robotics, illegally disclosed nonpublic information about the potential acquisition to a friend, Afshin Farahan, who subsequently purchased over $1 million worth of Mazor stock.

After the acquisition by Medtronic was announced, Farahan sold the stock, resulting in significant profits. Tavlin was convicted of conspiracy to commit insider trading and securities fraud.

“The morning after the acquisition was announced, Farahan immediately sold all the stock he had purchased over the preceding weeks, which resulted in a combined profit of over $500,000 for himself and one other individual,” the statement said.

According to evidence presented at trial, the conspiracy included an agreement that Farahan would pay money to Tavlin in exchange for nonpublic information about the acquisition.

Last week, a federal jury convicted Tavlin, 68, of one count of conspiracy to commit insider trading and 10 counts of securities fraud and aiding and abetting securities fraud.

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