Nineteen people were arrested, including Nicolo Nourafchan, a corporate lawyer who had worked at several large law firms and who was at the centre of a vast, decade-long scheme that netted him and his co-defendants tens of millions of dollars in illicit profits, prosecutors in Boston said.
The Yale Law School-educated lawyer worked from 2013 to 2023 at Sidley Austin, Latham & Watkins and Goodwin Procter, according to an indictment.
Prosecutors and the US Securities and Exchange Commission, which filed a related civil case, said Nourafchan worked with New York personal injury lawyer Robert Yadgarov to orchestrate the alleged scheme, which involved insider trading tips from Nourafchan and other lawyers.
The lawyers accessed law firms' internal computer networks to view confidential documents concerning pending mergers and then provided tips about those yet-to-be-announced deals to others in exchange for kickbacks, authorities said.
"The trading on unannounced financial news alleged here not only violated the securities laws, but it also took advantage of the special access and ethical duties that come with a law licence," US Attorney Leah Foley said in a statement.
Nourafchan, who lives in Los Angeles, and the other defendants face a host of charges, including securities fraud, and were expected to make their appearances in federal courts in California, Florida and New York.
Two defendants named in the two indictments unsealed are in Russia and Israel and are considered fugitives, prosecutors said.
Nine others were also charged in cases unsealed on Wednesday in which prosecutors secretly secured guilty pleas during the investigation.
They include Gabriel Gershowitz, who had worked at the law firms Weil, Gotshal & Manges; DLA Piper and Willkie Farr & Gallagher, according to his LinkedIn profile. He pleaded guilty in February 2025.
Lawyers for the defendants either could not be immediately identified or did not respond to requests for comment.
Prosecutors described the law firms in the case as victims. Latham & Watkins confirmed it was one, and said "the conduct as alleged would reflect a serious violation of our robust policies and procedures."
"We are deeply disappointed that a former employee is alleged to have violated the trust placed in him and misused confidential information as part of a broader criminal scheme affecting multiple law firms and their clients," Goodwin said.
According to prosecutors, Nourafchan and Yadgarov recruited lawyers and others to serve as sources of inside information in exchange for payments of hundreds of thousands of dollars in cash.
Nourafchan and Yadgarov also provided inside information to a network of traders and middlemen, prosecutors said.
The traders in turn placed trades on the tips on either the two lawyers' behalf or on their own behalf, and many then passed the information on to additional traders, authorities said.
In total, the traders implicated in the scheme engaged in insider trading ahead of nearly 30 M&A deals involving public companies, such as Amazon's proposal in 2022 to acquire iRobot, a deal the companies later abandoned in the face of antitrust regulator opposition.
At the time, Nourafchan was employed by Goodwin Procter, which advised iRobot. According to the indictment, he viewed confidential materials about the deal on the law firm's document management system while "on leave" from the firm.
