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October 25, 2019 at 09:55 AM
Former Securities and Exchange Commission enforcement staffer Michael Cohn has been indicted for stealing confidential information about a pending investigation to secure a job at private equity firm GPB Capital Holdings.
Cohn, the former managing director and chief compliance officer for GPB, was charged Wednesday by the U.S. Attorney’s Office for the Eastern District of New York with obstruction of justice, unauthorized computer access and unauthorized disclosure of confidential information.
Cohn was arraigned Wednesday morning before U.S. Circuit Judge Joseph F. Bianco and released on a $250,000 bond. Cohn, 59, faces up to 26 years in prison.
According to the charges, prior to leaving the SEC, Cohn accessed information on SEC servers relating to an Enforcement Division investigation into GPB.
“Cohn was not authorized to access this highly sensitive material, which included confidential information, privileged attorney-client work product and contacts with law enforcement and other regulatory agencies,” according to a statement from the Justice Department.
During discussions with GPB personnel about obtaining a job there, “Cohn advised them that he had inside information about the SEC’s investigation, and on several occasions he disclosed information to members of GPB’s senior management about that investigation,” the charges state.
The charges were announced by Richard Donoghue, U.S. attorney for the Eastern District of New York; William F. Sweeney Jr., assistant director-in-charge for the FBI’s New York Field Office; and Carl Hoecker, inspector general of the SEC.
“As alleged in the superseding indictment, the defendant abused the trust placed in him as an SEC employee, obstructing an active investigation,” Donoghue said in the statement. “No one gets a pass for breaching the security of government computer networks and misusing sensitive and confidential information for their own benefit.”
Cohn was a securities compliance examiner and industry specialist in the SEC’s Enforcement Division, where he assisted investigations into violations of securities laws.
In approximately October 2018, Cohn left the SEC to join GPB, a private equity firm based in Manhattan and Garden City, New York, that manages over $1.5 billion in assets.
