The husband of a BP employee has been charged with insider trading in the US following claims he overheard details of calls made by his wife while working from home. The US Securities and Exchange Commission alleged Tyler Loudon made $1.76m in illegal profits by eavesdropping on his wife’s conversations about BP’s takeover of TravelCenters of America and buying shares in the firm.

According to the SEC, Mr. Loudon took advantage of his remote working conditions and his wife’s trust to profit from confidential information. His wife, a mergers and acquisitions manager at BP, worked on the oil giant’s takeover of TravelCenters. Mr. Loudon purchased 46,450 shares of TravelCenters stock without his wife’s knowledge before the deal was made public in February last year. Following the announcement, TravelCenters’ share price rose nearly 71%, and Mr. Loudon allegedly immediately sold all of his newly-bought shares for a profit, as stated by the SEC.

During deal negotiations between TravelCenters and BP in 2022, Mr. Loudon and his wife worked in home offices within 20 feet of each other, leading to frequent overheard work-related conversations and video conferences, as per the regulator’s complaint. Mr. Loudon confessed to his wife about buying the TravelCenters shares after facing questions from the Financial Industry Regulatory Authority. His wife reported the trading to her supervisor at BP, leading to her termination, despite no evidence of her knowingly leaking the information to her husband or being aware of his share purchase.

As a result, Mr. Loudon’s wife moved out of the house and initiated divorce proceedings. The SEC stated that Mr. Loudon did not deny the allegations and agreed to pay a penalty, while also facing potential criminal charges and a prison sentence if convicted.

This case raises concerns about managing insider trading risks when working from home, particularly during the pandemic when remote work became prevalent. With the FCA emphasizing the need for effective surveillance in organizations’ remote working patterns, this incident serves as a cautionary tale about the potential consequences of exploiting confidential information in a remote work environment.