Ex-Goldman Analyst and His City Lawyer Brother Accused of Insider Dealing

Upmanyu Trivedi, Bloomberg News

(Bloomberg) -- An ex-Goldman Sachs Group Inc. analyst struck insider trades in ARM Holdings Plc and five other stocks reaping more than £140,000 ($179,850) along with his City lawyer brother, prosecutors said at the start of a London fraud trial.

Mohammed Zina, who worked in the Conflicts Resolution Group at Goldman’s London office, is standing trial for using confidential information for insider dealing between July 2016 and December 2017, along with his brother Suhail Zina, who was an attorney at Clifford Chance. The pair face six counts of insider trading and three fraud.

The allegations are that the brothers “acting together, used information they should not have used” to gamble on the stock exchange, Peter Carter, the lead prosecutor, said at Southwark Crown Court on Thursday.

Goldman’s policies prohibit employees trading in the securities of entities on which they have potential material nonpublic information, he told the jury. “That is precisely what Mohammed Zina did.”

Mohammed and Suhail deny the allegations and pleaded not guilty to the charges of insider trading and fraud. Mohammed worked at Goldman Sachs between 2014 and 2017, Carter said.

“It is clear Suhail was interested in and aware about his brother’s dealings,” he said. “There’s a lot to say about him. He’s a solicitor.”

The FCA alleges the brothers traded in the shares in ARM while it was listed in London, Alternative Networks Plc and Punch Taverns Plc, prosecutors said. The duo are also charged with fraud for funding their alleged insider dealing with £95,000 worth of personal loans for home improvements from Tesco Bank.

Mohammed Zina used trading accounts in the name of his brother and sister, the FCA’s lawyer said. He dealt with price-sensitive confidential information about mergers on a regular basis and made the trades without the knowledge of the bank or his colleagues, despite being aware of the restrictions on insider dealings, Carter said.

--With assistance from Jonathan Browning.

(Updates with details from the hearing throughout)