Reported by Corinne Ramey

Steven Teixeira’s use of his girlfriend’s laptop began innocently enough when she asked him to keep an eye on her work email while she went to fitness classes and ran errands.      

As they weathered the pandemic from their apartment in Queens, N.Y., he gave in to temptation. His sweetheart worked as an executive assistant at Morgan Stanley, and her calendar invites included meetings about planned mergers and acquisitions that involved the investment bank.

Teixeira, a compliance executive at a payment-processing company whom she intended to marry, used the information to trade in advance of the deals. It netted him thousands in profits, promises of Rolex watches from friends he tipped off, and the scrutiny of federal officials probing insider trading. He pleaded guilty to a dozen fraud charges in June.

There is a rich history in securities fraud of “pillow talk” cases, in which insider traders glean confidential information from romantic partners. The Covid era offered a twist: Secrets weren’t spilled in the bedroom or over a bottle of wine, but during the humdrum routine of two adults working from home.

“During Covid, there was an uptick in brazen conduct,” said Edward Imperatore, a defense lawyer at law firm Morrison & Foerster. “In a work-from-homeenvironment, people acted with more impunity.”

Another recent case snared a boyfriend who was training to work for the Federal Bureau of Investigation. Seth Markin pleaded guilty in December to trading on information he purloined from his lawyer girlfriend, an associate in the Washington office of law firm Covington & Burling. 

In 2021, she was working on a pharmaceutical acquisition from her one-bedroom apartment, where Markin spent days at a time. According to prosecutors, she trusted him because he told her he had a security clearance, was going to be an FBI agent, and wanted to marry her. 

Prosecutors said Markin passed on tips that led to at least 20 people trading based on confidential information. “I knew that my behavior was wrong,” Markin told the judge during his plea hearing. He is scheduled to be sentenced in March.

Representatives for the FBI and Covington declined to comment.

In Teixeira’s case, he was aided by a mouse-jiggler he bought that ensured his girlfriend’s laptop wouldn’t lock when she wasn’t using it, according to court documents. He has been cooperating with prosecutors and is scheduled to testify this year at the trial of his former friend, Jordan Meadow, who at the time was a stockbroker with Spartan Capital Securities.

Read full report: https://www.wsj.com/finance/insider-trading-pillow-talk-work-from-home-a56e2848