The Securities and Exchange Commission (SEC) has obtained final judgment against Andreas “Andy” Bechtolsheim, the founder and Chief Architect of Silicon Valley-based technology company Arista Networks, Inc in an action alleging that he engaged in insider trading.
The SEC alleged in its complaint, filed on March 26, 2024, that Bechtolsheim, who was Arista Networks’s chair at the time, illegally traded in Acacia options on July 8, 2019, after learning of Acacia’s impending acquisition through his and Arista Networks’s longstanding relationship with another multinational technology company that was also considering acquiring Acacia.
Immediately after learning this information, Bechtolsheim allegedly traded Acacia options in the accounts of a close relative and an associate. The next day, July 9, 2019, before the market opened, Acacia and Cisco announced that Cisco had agreed to acquire Acacia.
According to the SEC’s complaint, Bechtolsheim’s trading generated combined illegal profits of $415,726 in the accounts of his relative and associate.
Without admitting or denying the allegations in the SEC’s complaint, Bechtolsheim consented to the entry of the judgment which enjoins him from violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, bars him from serving as an officer or director of a public company for five years, and orders him to pay a civil monetary penalty of $923,740.
