US prosecutors have indicted Izunna Okonkwo, a dual US-Nigerian citizen, and five other defendants over an alleged $41 million insider-trading and stock-manipulation scheme said to have spanned nearly four years.
In a statement issued on Sunday, the US Department of Justice said a federal grand jury returned the charges on Friday, accusing the defendants of trading securities using material non-public information between June 2020 and February 2024.
Okonkwo was charged alongside Muhammad Saad Shoukat, Muhammad Arham Shoukat and Muhammad Shahwaiz Shoukat — all dual US-Pakistani citizens — as well as Daniyal Khan, a dual UK-Pakistani citizen.
Prosecutors said the alleged scheme relied on access to confidential deal information from within the US investment banking sector.
Court filings identified Sung Woo “Will” Kim, an investment banker involved in mergers and acquisitions in the healthcare and biopharmaceutical industries, as the original source of the information.
The justice department alleged that Kim obtained advance details of at least nine pending transactions involving publicly traded companies and unlawfully shared the information with Saad Shoukat.
Saad Shoukat was said to have traded on the tips personally and also passed them to associates, including Okonkwo, who allegedly traded on the information and profited.
Prosecutors said the group generated at least $41 million in illicit gains from the insider-trading activity.
Beyond insider trading, the defendants were also accused of manipulating share prices of selected companies to maximise profits and avoid losses.
One of the key allegations centres on Olema Pharmaceuticals, a publicly listed firm developing a breast cancer drug known as OP-1250.
According to the indictment, Saad Shoukat, Arham Shoukat and others acquired large volumes of Olema shares and promoted wider investment before gaining access to confidential trial data suggesting the drug underperformed expectations.
Prosecutors alleged that the defendants altered and falsified the data and released it in a manner designed to appear authentic, temporarily boosting Olema’s share price and allowing them to sell shares at inflated values.
The Justice Department also said the group engaged in similar manipulation involving Opiant Pharmaceuticals, a company developing treatments for opioid overdoses.
The defendants face multiple counts including securities fraud, conspiracy, insider trading and market manipulation, offences that carry potential maximum prison sentences of between 20 and 25 years per count if convicted.
The case adds to a growing list of fraud-related prosecutions involving Nigerian nationals or dual citizens in the United States.