Federal prosecutors charged 30 people in connection with a large insider trading operation built around stolen merger information taken from major US law firms, according to Reuters.
Nineteen defendants were arrested, including corporate attorney Nicolo Nourafchan, whom prosecutors described as a central figure in the decade-long scheme.
Authorities allege the operation generated tens of millions of dollars in illegal trading profits through confidential merger and acquisition information accessed inside elite law firms.
The case stretches across finance, corporate law, and organized insider trading networks operating for years underneath high-profile dealmaking activity.
According to federal prosecutors in Boston, Nourafchan worked at Sidley Austin, Latham & Watkins, and Goodwin Procter between 2013 and 2023. The Yale Law School graduate allegedly used internal law firm systems to access confidential deal documents tied to pending mergers before public announcement.
Prosecutors and the US Securities and Exchange Commission said Nourafchan worked alongside New York personal injury attorney Robert Yadgarov to organize the trading scheme.
Authorities allege the lawyers accessed internal document management systems at law firms handling sensitive mergers, reviewed confidential transaction materials, and passed deal information to traders and intermediaries in exchange for kickbacks.
US Attorney Leah Foley said the defendants exploited both confidential market information and the ethical obligations tied to legal practice.
According to Foley, the scheme relied on privileged access available only through positions inside major law firms handling corporate transactions.
Nourafchan, who lives in Los Angeles, faces securities fraud and other charges alongside multiple co-defendants.
Authorities said defendants are expected to appear in federal courts across California, Florida, and New York.
Two defendants located in Russia and Israel remain fugitives, prosecutors said. The investigation also produced several earlier guilty pleas kept under seal during the broader probe.
Among them was Gabriel Gershowitz, a lawyer who previously worked at Weil, Gotshal & Manges, DLA Piper, and Willkie Farr & Gallagher, according to his LinkedIn profile. Prosecutors said Gershowitz pleaded guilty in February 2025.
Law firms involved in the matter described themselves as victims of the operation. Latham & Watkins confirmed it was affected and stated the alleged conduct would violate firm policies and procedures.
Goodwin Procter said it was deeply disappointed by allegations that a former employee misused confidential client information as part of a broader criminal operation involving multiple firms and clients.
According to prosecutors, Nourafchan and Yadgarov recruited lawyers and other insiders willing to provide confidential information in exchange for cash payments sometimes reaching hundreds of thousands of dollars.
Authorities also allege the pair distributed inside information across a wider network of traders and middlemen who either traded directly on the tips or passed information further through secondary trading circles.
The scheme allegedly touched nearly 30 corporate merger transactions involving public companies.
One example involved Amazon’s proposed 2022 acquisition of iRobot, a transaction later abandoned after antitrust opposition from regulators.
At the time, prosecutors said Nourafchan worked at Goodwin Procter, which advised iRobot on the transaction.
According to the indictment, Nourafchan accessed confidential deal materials inside Goodwin’s document management system while on leave from the firm.
Insider trading cases involving lawyers carry extra scrutiny because corporate law firms sit near the center of global merger activity and routinely handle highly market-sensitive information before public disclosure.
According to Beinsure analysts, regulators increasingly focus on insider threats tied to digital access controls as law firms, banks, and advisory firms centralize sensitive deal information across internal systems.
The case also highlights a broader problem facing large professional services firms. Sophisticated insider trading schemes no longer depend entirely on overheard conversations or leaked paper files.
Internal document systems, digital permissions, and remote access tools now create larger attack surfaces when employees abuse privileged access.
