Marvell Technology’s Ng Accused of Insider Information

Statue of Justice on table next to book

Stanley Ng was arrested in California on charges arising from the Southern District of New York on August 10, 2011.  Mr. Ng, a former manager of Marvell Technology Group, was charged with conspiracy to commit securities fraud and wire fraud by allegedly providing insider information about Marvell to a consultant at expert networking firm Primary Global Research LLC.

Mr. Ng’s position at Marvell involved reporting the company’s financial information to the Securities and Exchange Commission.  The charges against Ng include the allegation that he provided financial information about Marvell to Winifred Jiau, a former consultant for Primary Global who was convicted in June of selling nonpublic information about Marvell.

According to a report in Law360, Ng is also accused of  giving insider information about Marvell to Jiau and an individual (Son Ngoc Nguyen) who worked in the finance department of Nvidia Corporation shortly before Marvell was to announce its quarterly financial reports. The prosecutors assert that Jiau had recruited both Ng and Nguyen to join an “investment club” to share insider information.

The conviction of Ms. Jiau earlier in the summer was marked—as was the trial in May of Raj Rajaratnam—by the use of wiretap evidence to substantiate the charges of insider trading.  The New York Times reported that a juror in Ms. Jiau’s case said “[t]he evidence was so strong nobody had to spend a lot of time to make a decision.  It was simple and clear.”  In Ms. Jiau’s case, the defense argued that the information revealed in the wiretaps was not “material” to investment decisions; in Mr. Rajaratnam’s case, the defense argued that the information utilized by Mr. Rajaratnam in making his buy-sell decisions was public and extensive—basically that the information on the wiretaps was irrelevant or superfluous.  The jury thought otherwise.