On May 4, 2020, the Securities and Exchange Commission charged husband and wife Zhuobin ("Ben") Hong and Caixia Jiang in a multi-million dollar insider trading scheme involving the securities of Sagent Pharmaceuticals, Inc.

According to the SEC's complaint, filed in federal district court in California, Hong and Jiang generated profits of approximately $8.5 million by trading in the securities of Sagent in advance of a July 11, 2016 announcement about the company's acquisition. The complaint alleges that the couple obtained confidential information about the acquisition directly or indirectly from a friend and neighbor whose company competed in the bidding process to acquire Sagent. According to the complaint, Hong and Jiang, who resided in California at the time of the trading but are now in China, attempted to evade detection by trading through accounts held in the names of relatives living in China. Between November 2015 and June 2016, these newly opened trading accounts amassed more than 1 million shares of Sagent stock. On multiple occasions, the defendants' purchases made up greater than 20% of the total trading volume in Sagent stock on that trading day, which they sold immediately following the acquisition announcement.

The case originated from the SEC Market Abuse Unit's Analysis and Detection Center, which uses data analysis tools to detect suspicious patterns.  Enhanced detection capabilities enabled SEC Enforcement staff to spot and uncover the unusual trading activity alleged in the SEC's complaint.

The SEC's complaint charges Hong and Jiang with violating the antifraud provisions of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14e-3 thereunder, and seeks disgorgement of ill-gotten gains plus interest, penalties, and injunctive relief. The complaint also names Hong's and Jiang's China-based relatives, Zhuoyan Hong and Haotao Jiang, as relief defendants and seeks to have them disgorge illicit gains generated by trading in their brokerage accounts.

The SEC's investigation was conducted by Megan Bergstrom, John Rymas, and Diana Tani of the SEC's Market Abuse Unit and Joseph Sansone, Chief of the Market Abuse Unit, supervised the case. The litigation will be led by Donald Searles and supervised by Amy Jane Longo of the SEC's Los Angeles Regional Office. The SEC appreciates the assistance of the Financial Industry Regulatory Authority and the Hong Kong Securities and Futures Commission.