Two men plead guilty to insider trading of Kodak stock

Two men pleaded guilty Wednesday to insider trading of Eastman Kodak Co. stock.

According to the office of the U.S. Attorney for the Southern District of New York, cousins James Andrew Stiles, 38, of Charleston, S.C., and Edward Gray Stiles, 39, of Richmond, Va., were arrested in 2023.

They used misappropriated information about potential government loans to be made to Kodak to finance the production of COVID-19-related pharmaceutical components.

Andrew Stiles stole confidential business information and used it to make unlawful trades, prosecutors said. He was an executive at a company that was working with Kodak to produce chemicals for pharmaceutical manufacturing in connection with the COVID-19 pandemic.

Stiles’ company was assisting Kodak with an application for a government loan, which resulted in the news, on July 27, 2020, of a government “letter of interest” to provide Kodak with a loan of $765 million.

In the following days, Kodak’s stock rose, at one point, to more than 2,500% above the closing price prior to the news.

During June and July 2020, Andrew Stiles was kept apprised of Kodak’s efforts to obtain the government loan, and he traded using the non-public information and passed that information to his cousin.

Between the time they learned about the potential loan and thy day the news was first publicized, Andrew Stiles purchased more than 90,000 shares of Kodak stock. Is cousin purchased more than 30,000 shares. The men sold all their shares in the days and weeks after the announcement. Together, they realized profits of more than $1.2 million.

They each pleaded guilty to securities fraud, which carries a maximum sentence of 20 years in prison.