CPA Crashes Company! Insider Trading Nets $55K Gains!

SEC v. Jai Sondhi — U.S. Securities and Exchange Commission Litigation Release No. 26542, dated April 28, 2026.

The SEC charged Jai Sondhi, a former Senior Director at Canoo, Inc., with insider trading. Sondhi allegedly used confidential information about a major electric vehicle contract to buy company stock and call options. After the contract was publicly announced and Canoo's stock price surged, Sondhi profited significantly.

In Plain English

Imagine you work for a company that makes electric cars. You learn a secret: your company is about to sign a huge deal with a big store to sell them lots of cars. This news will likely make your company's stock price go up. Before the news is public, you buy a lot of your company's stock and options to buy stock, knowing this secret. When the news comes out, the stock price jumps, and you sell your stock and options for a big profit. This is illegal because you used secret information to make money before everyone else knew.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. Learning Confidential Information In June 2022, Jai Sondhi, then Senior Director of Internal Audit and Controls at Canoo, Inc., learned in internal meetings that Canoo was close to signing a major contract with a prominent retailer to sell thousands of electric vehicles.
2. Purchasing Stock and Options Armed with this material non-public information, Sondhi purchased 2,500 shares of Canoo stock on June 24, 2022, and an additional 4,500 shares on July 5, 2022. He also bought 200 'out-of-the-money' call options on June 29, 2022.
3. Ignoring Company Policy Sondhi knew that company policy prohibited him from trading on such information, yet he proceeded with these purchases.
4. Public Announcement of Contract On July 12, 2022, Canoo publicly announced the significant transaction with the retailer.
5. Stock Price Surge Following the announcement, Canoo's stock price increased by 53%.
6. Profiting from Options On the same day as the announcement, July 12, 2022, Sondhi liquidated his call options, realizing a profit of $43,271.56.
7. Unrealized Gains Although he did not sell the common stock purchased, his unrealized gain on those shares totaled $11,693.67.
8. Total Ill-Gotten Gains Sondhi's total ill-gotten gains from these trades amounted to $54,965.23.

The Enforcement Action

On April 28, 2026, the SEC filed a settled action against Jai Sondhi. Sondhi consented to a permanent injunction against violating Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. He agreed to pay disgorgement of $54,965.23, plus prejudgment interest of $15,969.28, and a civil penalty of $54,965.23.

Named in this action: Jai Sondhi.

Original SEC litigation release ↗ · Browse all cases