The Federal Bureau of Investigation (FBI) arrested an equity analyst covering the technology sector. An alleged tipster for embattled hedge fund SAC Capital Advisors, the analyst was arrested in California, according to a report from Reuters based on information obtained from federal prosecutors on Tuesday.

SAC Capital

Sandeep Aggarwal provided non-public information

Sandeep Aggarwal allegedly provided non-public information regarding Yahoo! Inc. (NASDAQ:YHOO) and Microsoft Corporation (NASDAQ:MSFT) to one of the portfolio managers at SAC Capital Advisors.

Prosecutors will charge Aggarwal with conspiracy to commit securities fraud and wire fraud in the United Stated District Court for the Northern District of California later today. The FBI arrested him in San Jose, California yesterday. Aggarwal worked as a research analyst covering technology companies for Collins Stewart in San Francisco in 2009.

SEC files civil case against Sandeep Aggarwal

The Securities and Exchanges Commission (SEC) also filed a civil case against Agarwal for allegedly providing insider information to SAC Capital portfolio manager Richard Lee and to an employee of another hedge fund regarding the proposed partnership between Yahoo! Inc. (NASDAQ:YHOO) and Microsoft Corporation (NASDAQ:MSFT).

Lee served as portfolio manager for SAC Capital from 2009 to 2013. He managed $1.25 billion special situations fund across industry sectors for the hedge fund. He pleaded guilty for conspiracy and securities fraud.

With regard to the lawsuit against Aggarwal,  prosecutors alleged that he learned of the potential partnership between Yahoo and Microsoft after speaking with an employee of the software giant in July 2009. The following day, he informed Lee about the partnership before the companies made an announcement to the public.

George Venizelos, assistant director-in-charge for the FBI said, “Like many others before him, Sandeep Aggarwal allegedly broke the law and provided material non-public information on a Microsoft Corporation (NASDAQ:MSFT) – Yahoo! Inc. (NASDAQ:YHOO) deal. When questioned by his employer about the source of the information, he lied.”

Aggarwal is a citizen from India with a permanent resident status in the United States. He will make an initial court appearance in the federal court in California, and will eventually face the lawsuit filed against him in New York, according to prosecutors..

SAC Capital indicted with criminal charges

Last week, SAC Capital Advisors was indicted with criminal charges for securities fraud and wire fraud. The 41-page indictment against the hedge fund stipulated that its insider trading activities were systematic and resulted into millions of dollars in illegal profits and prevented losses at the expense of investors. SAC Capital Advisors pleaded not guilty to the fraud charges against it.

In addition, Steven A. Cohen, the head of SAC Capital Advisors, was charged with administrative case for allegedly failing to supervise his employees after several years of government investigation regarding the hedge fund’s insider trading activities. Currently, authorities already filed charges against ten SAC Capital employees who committed or were involved in insider trading.