Three former Netflix Inc. software engineers and two of their close associates were charged with insider trading, the U.S. Securities and Exchange Commission said Wednesday.
According to the civil complaint, the individuals accumulated about $3 million in profit from trading confidential information about Netflix’s subscriber growth, a crucial metric used in the company’s quarterly earnings announcement.
Sung Mo “Jay” Jun worked at Netflix between 2016 and 2017. The complaint alleges that his brother and his friend were repeatedly given information about subscriber growth and made trades ahead of company earnings announcements from 2017 to 2019. In July, the company said it has 209.2 million subscribers world-wide.
A spokesperson for Netflix declined to comment. A person who answered a call to a phone number listed for Sung Mo Jun on Thursday said they wouldn’t comment on the charges.
The complaint adds that after Mr. Jun departed the company, he allegedly obtained confidential subscriber-growth information from another “Netflix insider.” Mr. Jun then traded himself, and continued to give information to his brother and his friend using encrypted messaging apps in an attempt to hide their communications, the complaint said.
