In exchange for confidential information worth of millions of dollars to him, well-to-do Encino diamond jeweler Bryan Shaw admits, he gave his tipster at KPMG a $12,000 Rolex Daytona Cosmograph watch.
Shaw, of Shaw Diamond Co. located in a high-rise on Ventura Boulevard, pleaded guilty Monday to federal charges for making illegal stock trades based on alleged advice from Scott London. London, also a wealthy guy, was fired by KPMG — one of the world's Big Four auditing firms — on April 5, the day he got arrested by the feds.
The behavior of these two men who had everything — and now, it seems, have nothing — goes beyond just money business.
And according to Fred Shuster at City News Service:
“These two men were close friends who shared dinners, concerts, sporting events and secret information that brought profits to each of them,” U.S. Attorney Andre Birotte Jr. said previously.
“London provided, and Shaw was all too happy to use, proprietary information that should have remained confidential. These men broke ethical rules and criminal laws for the sole purpose of lining their pockets with illegal profits.”
London even advised Shaw on how to structure the purchase of stocks in order to avoid getting caught, according to the U.S. Attorney's Office.
Must have been horrendous advice.
It's hard to imagine how impervious this pair must have felt. Once, authorities say, London met Shaw on a corner in Encino and got a bag of $5,000 — a bag, like in a bad movie — all in $100 bills.
That was thanks, apparently, for the February earnings announcement of Herbalife, a client of KPMG's.
Later they met at the very busy Rite-Aid parking lot on the corner of Topanga Canyon and Ventura boulevards in Woodland Hills, where Shaw handed London another packet with $5,000 in cash inside, allegedly. (See their in-plain-sight exchange on first page of this post.)
This wad of cash was supposedly a share of profits from illegal insider trades based on information about Decker's February 2013 earnings announcement, according to the U.S. Attorney's Office.
Shaw is set for sentencing on Sept. 16. London is scheduled for arraignment on Thursday, May 30 in Los Angeles.