Business

Ex-KPMG partner facing charges

The payments came in various forms. There were envelopes of $100 bills wrapped in $10,000 bundles. There were tickets to a Bruce Springsteen concert. There was a 2011 Rolex Cosmograph Daytona valued at $12,000.

Bryan Shaw, the owner and operator of a Los Angeles-area jewelry business, bestowed these gifts on his longtime friend and golf buddy Scott I. London, a senior partner at the accounting giant KPMG. In return for such largesse, Shaw received secret information from London about ­KPMG clients, and earned more than $1 million illegally trading in the shares of ­publicly traded companies.

On Thursday, federal prosecutors filed criminal charges against London, laying bare a brazen two-year insider trading scheme. The Securities and Exchange Commission filed a parallel civil case against London and Shaw.

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“London was honored with the highest trust of public companies, and he crassly ­betrayed that trust for bags of cash and a Rolex,’’ George S. Canellos, the acting director of enforcement at the SEC, said in a statement.

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London and Shaw have ­already acknowledged their misconduct in statements ­issued through their lawyers.

Shaw began cooperating with the government in February after they confronted him with evidence of insider trading. He turned against his friend, recording telephone conversations and in-person meetings to help the authorities build a case against London.

Federal authorities opened up an investigation last July after the brokerage firm ­Fidelity raised red flags about activity in Shaw’s account .

New York Times