Business

Husband ‘made over a million’ by eavesdropping on BP wife

The regulator claimed Mr Loudon heard several of his wife's conversations about BP's takeover of TravelCenters of America and bought shares in the firm

The husband of a BP employee has been charged with insider trading in the US following claims he overheard details of calls made by his wife while working from home.

The US Securities and Exchange Commission alleged Tyler Loudon made US$1.76 million (£1.39m) in illegal profits.

The regulator claimed Mr Loudon heard several of his wife’s conversations about BP’s takeover of TravelCenters of America and bought shares in the firm.

BP has declined to comment

 

The SEC said: “We allege that Mr Loudon took advantage of his remote working conditions and his wife’s trust to profit from information he knew was confidential.”

His wife – a mergers and acquisitions manager at BP – worked on the oil giant’s takeover of TravelCenters. The SEC said Mr Loudon purchased 46,450 shares of TravelCenters stock, without his wife’s knowledge, before the deal was made public in February last year.

Following the announcement, TravelCenters share price rose nearly 71% and Mr Loudon allegedly immediately sold all of his newly-bought shares for a profit, the SEC said.

Divorce

In a complaint by the regulator, during deal negotiations between TravelCenters and BP in 2022, Mr Loudon, of Houston, Texas, and his wife worked in home offices within 20 feet of each other.

“As a result, they frequently overheard and witnessed each other’s work-related conversations and video conferences.” She also worked on the deal when the couple stayed in a “small Airbnb” in Rome, said the complaint.

Mr Loudon confessed to his wife about buying the TravelCenters shares after the Financial Industry Regulatory Authority began asking questions about the BP deal and who was “in the know”.

According to the filing, he said he bought the stock because “he wanted to make enough money so that she did not have to work long hours anymore”.

His wife – who was “stunned by this revelation” – reported the trading to her supervisor at BP.

Her email and texts were reviewed by BP and it found no evidence that she knowingly leaked the information about the deal to her husband or knew he had bought the shares.

But “BP nonetheless terminated her employment,” said the filing.

According to the regulator’s complaint, Mr Loudon’s wife moved out of the house and ceased all contact with him. In June, she initiated divorce proceedings.

‘Effective surveillance’

In a statement, the SEC said Mr Loudon did not deny the allegations and agreed to pay a penalty.

He also faces potential criminal charges and if convicted, could face a prison sentence.

During the pandemic, when many employees were unable to work in the office, UK regulator the Financial Conduct Authority (FCA) warned about managing insider trading risks when working from home.

With working from home now cemented into many organisations working patterns, the FCA has said the “need for effective surveillance at all times” remained critical.

 

 

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BBC
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