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A former partner at Ernst & Young (E&Y) in New York has been found guilty of fraud after giving information to a friend about huge corporate transactions, who then profited from the knowledge in their own share dealings.

 

James Gansman, was a lawyer in firm’s transactions division, and was responsible for advising companies on human resources issues during mergers and acquisitions.

Between May 2006 and the end of July 2007, he passed on information about several proposed buyouts to a friend who then used the details to trade shares for a profit of almost $400,000.

The jury found Gansman, who resigned from E&Y in October 2007, guilty of six counts of securities fraud, each of which carries a maximum prison sentence of 20 years and a fine of up to $5 million (£3.3 million). He was freed on bail and is due to be sentenced on October 1.

The Federal Bureau of Investigation and the US Securities and Exchange Commission were involved in the investigation, which is continuing.

E&Y declined to comment on Friday but has said previously that it co-operated with the investigation.