Brian Jorgenson, a former Microsoft senior manager, was sentenced Friday to two years in prison, and three years of supervised release after that, for insider trading.
Jorgenson, 32, of Lynnwood, who worked in Microsoft’s treasury group, pleaded guilty earlier this year. He admitted that he recruited a friend and former co-worker at an asset management company to make stock trades based on inside information.
That friend and former co-worker, Sean Stokke, 28, of Seattle, was sentenced last month to 18 months in prison.
Jorgenson told The Seattle Times last December that he had tipped a friend to nonpublic, proprietary Microsoft financial information three times in the past 18 months, allowing the friend to make money in the stock market. He had estimated at the time that his friend made more than $200,000, although he didn’t know exactly how much money was made since he didn’t have direct access to his friend’s trading accounts. In exchange, Jorgenson said, his friend gave him about $40,000.
According to the U.S. Attorney’s Office for the Western District of Washington, the two men made $415,000 total from the three trades.
They made $184,000 in profit from Jorgenson’s early knowledge of Microsoft’s investment in Barnes and Noble; $218,000 from Microsoft’s failure to meet earnings estimates in the fourth quarter of fiscal year 2013; and $13,000 from Microsoft’s increased earnings per share for the first quarter of fiscal 2014, according to the U.S. Attorney’s Office’s news release.
At the sentencing hearing, Jorgenson told the court: “I cheated. I tried to take a shortcut for my own financial gain…. I persuaded myself it was a gray area, when it clearly was black and white,” according to the news release.
“Motivated by greed, this defendant traded on his employer’s confidential information to line his own pocket,” U.S. Attorney Jenny Durkan said in the release. “Western Washington abounds in publicly traded companies with thousands of insiders who have daily access to market moving information. The sentence in this case should serve as a warning to others who might be tempted to engage in this conduct.”
Microsoft sent a statement, saying: “Our company has zero tolerance for insider trading. We helped the government with its investigation and terminated the employee.”
I have asked Jorgenson’s attorney for comment and will post any response.
[Information from Seattle Times archives was used in this report.]