One insider bought 35,000 shares of the company’s stock, which pumped on the news, selling after the announcement was formalized.
The U.S. Securities and Exchange Commission (SEC) charged three individuals with insider trading on allegations they bought shares of Long Island Iced Tea ahead of its 2017 announcement it would pivot to a blockchain-based business model.
The SEC charged Eric Watson, Oliver Barret-Lindsay and Gannon Giguiere on Friday. According to a press release, Watson was “an undisclosed control person” at Long Island Iced Tea, who shared unannounced plans to convert the company to a blockchain business at the height of the initial coin offering (ICO) boom.
Giguiere bought 35,000 shares of the company’s stock, which pumped on the news, then selling after the announcement was formalized and making $160,000 on the sale.
Long Blockchain, as the renamed corporation was called, saw its stock price explode after the pivot was announced. The company was later delisted from the Nasdaq stock exchange.
The FBI was reportedly investigating whether Barret-Lindsay and Giguiere had profited off insider trading as far back as 2019.
According to the SEC, the two are also defendants in an unrelated microcap fraud scheme.