A dual US-Nigerian citizen and five others have been indicted by US authorities for allegedly participating in a sophisticated $41 million insider trading and stock manipulation scheme targeting healthcare and biopharmaceutical companies between 2020 and 2024.
By Peter Imini
Federal prosecutors have unveiled charges against six individuals, including a dual US-Nigerian citizen, in what authorities describe as an elaborate multi-year securities fraud scheme that netted the conspirators at least $41 million in illicit profits.
Izunna Okonkwo, the Nigerian national with dual US citizenship, stands accused alongside five other defendants of various nationalities in a case that highlights the increasingly global nature of financial crimes. The United States Department of Justice announced the indictments on Friday, revealing a complex web of insider trading and stock manipulation that allegedly operated from June 2020 through February 2024.
The Accused and Their Alleged Roles
The indictment identifies the other defendants as Muhammad Saad Shoukat, 33, who allegedly served as a central figure in the conspiracy, along with his brothers Muhammad Arham Shoukat, 35, and Muhammad Shahwaiz Shoukat, 36—all three holding dual US-Pakistani citizenship. Also charged are Daniyal Khan, 33, a dual UK-Pakistani citizen described as Saad Shoukat’s friend, and an individual identified as Kim, who worked at an investment bank involved in mergers and acquisitions.
According to the Justice Department’s statement, the scheme relied on Kim’s access to privileged information through their position at the investment bank. The statement explained the operation’s mechanics: “Kim worked at an investment bank that was actively involved in multiple mergers and acquisitions of publicly traded healthcare and biopharmaceutical companies. Kim obtained material non-public information about many of these pending deals, either by working on the deals directly or from others who did.”
The Insider Trading Operation
The alleged conspiracy involved a systematic exploitation of confidential corporate information. Prosecutors claim that Kim illegally shared sensitive details about at least nine pending merger and acquisition deals with Saad Shoukat, who then orchestrated trades based on this privileged information both personally and through a network of associates.
The Justice Department detailed how the information flowed through the conspiracy: “Kim illegally shared the information about at least nine of these deals with Saad Shoukat, who traded on that information by himself and through others. Saad Shoukat also tipped off others—including Arham Shoukat, Shahwaiz Shoukat, Khan, and Okonkwo—who similarly traded and profited from the material non-public information. Overall, Saad Shoukat and his co-conspirators received illicit profits from the insider trading scheme totalling at least $41m.”
The Olema Manipulation Scheme
Beyond insider trading, prosecutors allege the defendants engaged in an even more audacious scheme involving the manipulation of Olema, a publicly traded biopharmaceutical company developing breast cancer treatments. This aspect of the case demonstrates the sophistication and brazenness of the alleged fraud.
According to the indictment, Saad Shoukat and Arham Shoukat, along with unnamed co-conspirators, “actively manipulated the stock price of Olema, a publicly traded company focused on developing breast cancer treatment through a drug called OP-1250.”
The Justice Department’s statement reveals a calculated scheme that evolved from investment to manipulation: “From the spring of 2021, Saad Shoukat and Arham Shoukat began investing in Olema stock and encouraged others to invest in it. After purchasing substantial stock in Olema, Saad Shoukat, Arham Shoukat, and others accessed confidential information showing that OP-1250 was less effective than they had hoped.”
What allegedly happened next represents a serious escalation in the criminal conduct. Prosecutors claim the conspirators fabricated clinical trial data to artificially inflate the stock price: “They then falsified the OP-1250 data that the co-conspirators had illegally accessed and publicly disseminated it in a manner that made it appear authentic and as though it originated from Olema. The release of the false data—which inflated the drug’s perceived efficacy—temporarily caused Olema’s stock price to rise, during which Saad Shoukat, Arham Shoukat, and others profited and avoided losses by selling large volumes of Olema shares.”
The defendants are also accused of similar manipulation involving Opiant, another publicly traded company developing opioid overdose treatments.
Potential Consequences
The charges against the six defendants are severe, encompassing stock manipulation, conspiracy to commit securities fraud, insider trading, and related offenses. If convicted on all counts, each defendant faces maximum prison sentences ranging from 20 to 25 years per count, underscoring the gravity with which federal authorities view these alleged crimes.
A Pattern of Nigerian Involvement
The Justice Department statement notes that Okonkwo’s case is not an isolated incident. Nigerian nationals have been involved in various fraud cases prosecuted in the United States in recent months. Just weeks before this indictment, on December 4, federal authorities ordered the deportation of another Nigerian, Oluwaseun Adekoya, following completion of a 20-year prison sentence for his role in a $2 million fraud scheme.
Adekoya was convicted of conspiracy to commit bank fraud, conspiracy to commit money laundering, and nine counts of aggravated identity theft after a three-week trial, demonstrating the sustained attention US authorities pay to international financial crimes.
Implications for Market Integrity
This case highlights the ongoing challenges facing securities regulators and law enforcement in protecting market integrity in an increasingly interconnected global financial system. The alleged scheme’s sophistication—involving insider information from investment banks, falsified clinical trial data, and coordination across multiple countries—demonstrates the evolving nature of securities fraud in the digital age.
As the case proceeds through the federal court system, it will likely serve as a reminder of the serious consequences facing those who attempt to manipulate financial markets, regardless of their nationality or location.