Two Volkswagen Engineers Charged with Insider Trading Related to Rivian Joint Venture
The U.S. Department of Justice has charged two Volkswagen engineers with securities fraud for allegedly using confidential information about the automaker's joint venture with Rivian to make over $300,000 in illegal profits.
Charges Filed
The U.S. Department of Justice unsealed an indictment on Friday charging two Volkswagen engineers, Michael Stamp and Marcus Plank, with securities fraud. The charges stem from an alleged insider trading scheme connected to the German automaker's joint venture with electric vehicle maker Rivian.
Details of the Scheme
The joint venture, internally codenamed "Project Climb," was publicly announced on June 25, 2024, and focuses on developing electric vehicle architecture and software. Volkswagen initially committed $5 billion to Rivian, later increasing to $5.8 billion, making Volkswagen Rivian's largest shareholder. Rivian's stock rose 23% following the announcement.
According to the indictment, Stamp and Plank purchased Rivian stock and options after learning about the joint venture but before any public announcement. They then sold their positions after the stock price jumped. Stamp realized approximately $250,000 in profits, Plank realized about $50,000, and a close family member of Plank realized about $12,000.
Investigation and Potential Penalties
Both engineers reside in San Jose, California, and were arrested on Friday. They are expected to appear in the U.S. District Court for the Northern District of California. The case has been assigned to U.S. District Judge Katherine Polk Failla.
Investigators allege the engineers were aware their actions were illegal. Eight days before the joint venture announcement, Stamp searched for "statute of limitations insider trading," and Plank's family member searched in German for "how is insider trading prosecuted?"
If convicted of federal securities fraud, Stamp and Plank face up to 25 years in prison.
