Bloomberg News

FDA Insider-Trading Defendant Charged With Child Pornography

September 13, 2011

(Updates with forfeiture request in second paragraph.)

Sept. 13 (Bloomberg) -- Andrew Liang, accused of joining an insider-trading scheme with his father, a U.S. Food and Drug Administration chemist, was charged with possessing child pornography found in the course of the fraud investigation.

Liang, and his father, Cheng Yi Liang, who worked for the FDA’s Center for Drug Evaluation and Research, allegedly reaped at least $3 million from trading on nonpublic information related to drug-approval applications.

Liang was charged today in federal court in Maryland with one count of possessing child pornography. The government asked that Liang forfeit a MacBook laptop computer seized at his Gaithersburg, Maryland home during raids by the Federal Bureau of Investigation in March and April.

Liang’s lawyer, Timothy Sullivan, didn’t immediately return telephone messages seeking comment on the new charge.

If convicted, Liang faces a maximum penalty of 10 years in prison and a $250,000 fine. Liang would also be required to register as a sex offender. Liang is free pending a court date, which has yet to be scheduled, said Marcia Murphy, a spokeswoman for U.S. Attorney Rod Rosenstein.

Prosecutors charged the Liangs in March with conspiracy, wire fraud and securities fraud. The maximum penalty for the fraud charges is 20 years in prison.

The insider-trading case has been postponed because “the parties are near resolution of this matter,” David Salem, assistant U.S. attorney, said in an Aug. 29 filing.

The new case is U.S. v. Andrew Liang, 11-cr-00501. The insider trading cases are U.S. v. Chen Yi Liang, 8:11-mj-01236- WGC, and U.S. v. Andrew Liang, 8:11-mj-01237-WGC, U.S. District Court, District of Maryland (Greenbelt).

--Editors: Fred Strasser, Mary Romano

To contact the reporter on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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