The SEC said that Prado learned of the Burger King deal from a brokerage customer while working for Wells Fargo in Miami. Then Prado used the information about Burger King’s impending acquisition by private equity firm 3G Capital Partners Ltd to tip off others and also to net about $175,000 by trading in the stock ahead of the deal.
According to documents produced by the SEC Prado had emailed customers in Portuguese to call him to get the insider information. Some recipients of his emails were later found to have called him up and then engaged in purchasing Burger King call options during the next two days.
Sanjay Wadhwa, the deputy chief of the SEC enforcement division’s market abuse unit told the media, “Prado’s emails and other communications may have been sent from Brazil and written in Portuguese, but our commitment to prosecute illegal insider trading on U.S. markets knows no geographic or language barrier.”
According to industry sources, Prado’s employment with Morgan Stanley has already been terminated and Wells Fargo was cooperating with SEC in the investigation.