A dual United States–Nigerian citizen, Izunna Okonkwo, has been indicted alongside five others of different nationalities over an alleged $41 million stock market fraud in the United States.
Information obtained from a statement published on the website of the United States Department of Justice on Sunday revealed that Okonkwo and his co-defendants allegedly engaged in insider trading between June 2020 and February 2024.
The statement said the six suspects were charged on Friday for their alleged roles in a years-long scheme involving the trading of securities based on material non-public information.
The other defendants were identified as Muhammad Saad Shoukat, 33; his brothers, Muhammad Arham Shoukat, 35, and Muhammad Shahwaiz Shoukat, 36, all dual US-Pakistani citizens, as well as their associate, Daniyal Khan, 33, a dual UK-Pakistani citizen.
Explaining the alleged insider trading scheme, the statement noted, “Kim worked at an investment bank that was actively involved in multiple mergers and acquisitions of publicly traded healthcare and biopharmaceutical companies.
“Kim obtained material non-public information about many of these pending deals, either by working on the deals directly or from others who did.
“Kim illegally shared the information about at least nine of these deals with Saad Shoukat, who traded on that information by himself and through others.
“Saad Shoukat also tipped off others—including Arham Shoukat, Shahwaiz Shoukat, Khan, and Okonkwo—who similarly traded and profited from the material non-public information.
Overall, Saad Shoukat and his co-conspirators received illicit profits from the insider trading scheme totalling at least $41m.”
The statement further alleged that some of the defendants were involved in what it described as the Olema Manipulation Scheme, noting that “Saad Shoukat, Arham Shoukat, and others actively manipulated the stock price of Olema, a publicly traded company focused on developing breast cancer treatment through a drug called OP-1250.
“From the spring of 2021, Saad Shoukat and Arham Shoukat began investing in Olema stock and encouraged others to invest in it.
“After purchasing substantial stock in Olema, Saad Shoukat, Arham Shoukat, and others accessed confidential information showing that OP-1250 was less effective than they had hoped.
“They then falsified the OP-1250 data that the co-conspirators had illegally accessed and publicly disseminated it in a manner that made it appear authentic and as though it originated from Olema.
“The release of the false data—which inflated the drug’s perceived efficacy—temporarily caused Olema’s stock price to rise, during which Saad Shoukat, Arham Shoukat, and others profited and avoided losses by selling large volumes of Olema shares.”
The defendants were also accused of manipulating the stock price of Opiant, another publicly traded company involved in the development of opioid overdose treatment.
According to the statement, the suspects were charged with offences bordering on stock manipulation, conspiracy and insider trading, among others, and face maximum prison sentences ranging from 20 to 25 years on each count if convicted.
Okonkwo is not the first Nigerian to be indicted in the United States over fraud-related allegations.