SEC v. Joseph C. Lewis; Carolyn W. Carter; Patrick J. O’Connor; and Bryan L. Waugh, No. LR-26489, Southern District of New York (Feb. 24, 2026) — Press Release
raw: Joseph C. Lewis, Carolyn W. Carter, Patrick J. O’Connor, and Bryan L. Waugh
Joseph C. Lewis, Carolyn W. Carter, Patrick J. O’Connor, and Bryan L. Waugh, No. 1:23-cv-06438 (S.D.N.Y. Feb. 24, 2026)
summary
Joseph C. Lewis and three associates secured final consent judgments for insider trading involving material nonpublic information obtained through a biotechnology investment fund.
paragraph
The SEC obtained final judgments against Joseph C. Lewis, Carolyn W. Carter, Patrick J. O’Connor, and Bryan L. Waugh for violating Section 10(b) of the Securities Exchange Act. Lewis was ordered to pay $1,636,645.11 in penalties, while Carter, O’Connor, and Waugh were ordered to pay combined disgorgements and interest totaling over $500,000. The defendants are permanently enjoined from future antifraud violations under Rule 10b-5.
narrative
The SEC secured final consent judgments against Joseph C. Lewis, his former girlfriend Carolyn W. Carter, and his private pilots, Patrick J. O’Connor and Bryan L. Waugh, for insider trading. Lewis allegedly used his control of a biotechnology investment fund to obtain material nonpublic information, which he then tipped to Carter and his pilots to facilitate profitable trades. Carter traded in two companies, while O’Connor and Waugh traded in at least one. The court imposed permanent injunctions against all defendants for violating Section 10(b) of the Securities Exchange Act and Rule 10b-5. Financial sanctions include a $1.6 million penalty for Lewis and significant disgorgement and interest payments for the other three defendants. While Carter and Waugh did not admit or deny the allegations, all parties are now subject to court-ordered sanctions. The enforcement action was supported by an extensive network of international regulatory agencies.
Classified insider-trading(confidence 100%). EDGAR detection: forms 4/3/5/144· recall 81% / precision 19%. detection rule →
Parties
Securities and Exchange CommissionJoseph C. LewisCarolyn W. CarterBryan L. WaughPatrick J. O'ConnorJean J. O'Connor
Keywords
lewiscarterconnorwaughjoseph lewislewis carolyncarolyn cartercarter patrickpatrick connorconnor bryanbryan waughsecurities exchangeconnor waughsecuritiessec
Exhibits & Attached Documents (4)
Extracted insights
Dollar amounts 9
- $1.64M $1,636,645 $1M–$10M
- $241K $241,154 $100K–$1M
- $172K $171,886 $100K–$1M
- $133K $132,507 $100K–$1M
- $44K $43,589 $10K–$100K
- $33K $33,126 $10K–$100K
- $29K $29,257 $10K–$100K
- $24K $24,221 $10K–$100K
- $23K $22,554 $10K–$100K
Entities 4
- person bryan l. waugh
- person carolyn w. carter
- person Joseph C. Lewis
- agency Securities and Exchange Commission
Triples 25
- Securities And Exchange Commission obtained final consent judgments Joseph C. Lewis, Carolyn W. Carter, Patrick J. O'Connor, and Bryan L. Waugh
- Joseph C. Lewis obtained material nonpublic information about two public companies through his majority ownership and control of a biotechnology investment fund
- Joseph C. Lewis tipped information to Carolyn W. Carter
- Carolyn W. Carter realized ill-gotten profits by trading in the stock of two companies on the basis of tipped information
- Joseph C. Lewis tipped information to Patrick J. O'Connor and Bryan L. Waugh
- Patrick J. O'Connor realized ill-gotten profits by trading in one company's stock on the basis of tipped information
- Bryan L. Waugh realized ill-gotten profits by trading in one company's stock on the basis of tipped information
- Court entered final judgments as to Joseph C. Lewis on November 26, 2024
- Court entered final judgments as to Carolyn W. Carter on February 13, 2025
- Court entered final judgments as to Patrick J. O'Connor and Bryan L. Waugh on February 4, 2026
- Securities And Exchange Commission permanently enjoined defendants from violating antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5
- Securities And Exchange Commission ordered defendants to pay penalties, disgorgement, and prejudgment interest
- Joseph C. Lewis paid penalty $1,636,645.11
- Carolyn W. Carter paid penalty $241,154.81
- Carolyn W. Carter paid disgorgement $241,154.81
- Carolyn W. Carter paid prejudgment interest $43,589.44
- Patrick J. O'Connor paid penalty $24,221.53
- Patrick J. O'Connor paid disgorgement $171,886.12
- Patrick J. O'Connor paid prejudgment interest $29,257.46
- Bryan L. Waugh paid penalty $33,126.86
- Bryan L. Waugh paid disgorgement $132,507.44
- Bryan L. Waugh paid prejudgment interest $22,554.64
- Securities And Exchange Commission conducted litigation by Carina Cuellar and Timothy Work, supervised by Jim Carlson and Jim Connor
- Securities And Exchange Commission conducted investigation by Timothy Work, with assistance from Howard Kaplan, Yongping Zheng, and Kevin Gershfeld, supervised by Kevin Guerrero and Mark Cave
- Securities And Exchange Commission appreciated assistance from U.S. Attorney's Office for the Southern District of New York, Federal Bureau of Investigation, Financial Industry Regulatory Authority, Department of Homeland Security, U.S. Customs and Border Protection, Federal Aviation Administration, Securities Commission of the Bahamas, Swiss Financial Market Supervisory Authority, Australian Securities and Investments Commission, National Securities Commission of Argentina, Central Bank of Uruguay, UK Financial Conduct Authority, Cayman Islands Monetary Authority, Isle of Man Financial Services Authority, and Autorité des marchés financiers of Quebec
PDF (from attached: judgment)
Text layers
Extracted body text (3,042c)
U.S. SECURITIES AND EXCHANGE COMMISSIONLitigation Release No. 26489 / February 24, 2026Securities and Exchange Commission v. Joseph C. Lewis, et al., No. 1:23-cv-06438 (S.D.N.Y. filed July 26, 2023)SEC Obtains Final Consent Judgments as to Joseph C. Lewis, Carolyn W. Carter, Patrick J. O’Connor, and Bryan L. Waugh in Alleged Insider Trading CaseThe Securities and Exchange Commission announced today the entry of final consent judgments as to Joseph C. Lewis, Carolyn W. Carter, Patrick J. O’Connor, and Bryan L. Waugh in the SEC’s civil enforcement action against Lewis, his then-girlfriend Carter, and his private pilots, O’Connor and Waugh.According to the SEC’s complaint, filed in federal district court in the Southern District of New York, Lewis obtained material, nonpublic information about two public companies through his majority ownership and control of a biotechnology investment fund. As alleged, Lewis then violated a duty of trust and confidence by tipping this information to Carter, who realized ill-gotten profits by trading in the stock of both companies on the basis of this information. Separately, the complaint alleged that Lewis tipped information about one of the companies to O’Connor and Waugh, who realized ill-gotten profits by trading in that company’s stock on the basis of this information.The Court entered the final judgments as to Lewis and Carter on November 26, 2024 and February 13, 2025, respectively, and entered the final judgments as to O’Connor and Waugh on February 4, 2026. Carter and Waugh neither admitted nor denied the allegations in the SEC’s complaint. The final judgments permanently enjoin the defendants from violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and order them to pay penalties, disgorgement, and prejudgment interest in the following amounts: PenaltyDisgorgementPrejudgment InterestLewis$1,636,645.11––Carter$241,154.81$241,154.81$43,589.44O’Connor$24,221.53$171,886.12$29,257.46Waugh$33,126.86$132,507.44$22,554.64 The SEC’s litigation was conducted by Carina Cuellar and Timothy Work and supervised by Jim Carlson and Jim Connor. The SEC’s investigation was conducted by Mr. Work, with assistance from Howard Kaplan, Yongping Zheng, and Kevin Gershfeld, under the supervision of Kevin Guerrero and Mark Cave. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York, the Federal Bureau of Investigation, the Financial Industry Regulatory Authority, the Department of Homeland Security, U.S. Customs and Border Protection, the Federal Aviation Administration, the Securities Commission of the Bahamas, the Swiss Financial Market Supervisory Authority, the Australian Securities and Investments Commission, the National Securities Commission of Argentina, the Central Bank of Uruguay, the UK Financial Conduct Authority, the Cayman Islands Monetary Authority, the Isle of Man Financial Services Authority, and the Autorité des marchés financiers of Quebec.
OCR text (3,042c · html-text · 99% conf)
U.S. SECURITIES AND EXCHANGE COMMISSIONLitigation Release No. 26489 / February 24, 2026Securities and Exchange Commission v. Joseph C. Lewis, et al., No. 1:23-cv-06438 (S.D.N.Y. filed July 26, 2023)SEC Obtains Final Consent Judgments as to Joseph C. Lewis, Carolyn W. Carter, Patrick J. O’Connor, and Bryan L. Waugh in Alleged Insider Trading CaseThe Securities and Exchange Commission announced today the entry of final consent judgments as to Joseph C. Lewis, Carolyn W. Carter, Patrick J. O’Connor, and Bryan L. Waugh in the SEC’s civil enforcement action against Lewis, his then-girlfriend Carter, and his private pilots, O’Connor and Waugh.According to the SEC’s complaint, filed in federal district court in the Southern District of New York, Lewis obtained material, nonpublic information about two public companies through his majority ownership and control of a biotechnology investment fund. As alleged, Lewis then violated a duty of trust and confidence by tipping this information to Carter, who realized ill-gotten profits by trading in the stock of both companies on the basis of this information. Separately, the complaint alleged that Lewis tipped information about one of the companies to O’Connor and Waugh, who realized ill-gotten profits by trading in that company’s stock on the basis of this information.The Court entered the final judgments as to Lewis and Carter on November 26, 2024 and February 13, 2025, respectively, and entered the final judgments as to O’Connor and Waugh on February 4, 2026. Carter and Waugh neither admitted nor denied the allegations in the SEC’s complaint. The final judgments permanently enjoin the defendants from violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and order them to pay penalties, disgorgement, and prejudgment interest in the following amounts: PenaltyDisgorgementPrejudgment InterestLewis$1,636,645.11––Carter$241,154.81$241,154.81$43,589.44O’Connor$24,221.53$171,886.12$29,257.46Waugh$33,126.86$132,507.44$22,554.64 The SEC’s litigation was conducted by Carina Cuellar and Timothy Work and supervised by Jim Carlson and Jim Connor. The SEC’s investigation was conducted by Mr. Work, with assistance from Howard Kaplan, Yongping Zheng, and Kevin Gershfeld, under the supervision of Kevin Guerrero and Mark Cave. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York, the Federal Bureau of Investigation, the Financial Industry Regulatory Authority, the Department of Homeland Security, U.S. Customs and Border Protection, the Federal Aviation Administration, the Securities Commission of the Bahamas, the Swiss Financial Market Supervisory Authority, the Australian Securities and Investments Commission, the National Securities Commission of Argentina, the Central Bank of Uruguay, the UK Financial Conduct Authority, the Cayman Islands Monetary Authority, the Isle of Man Financial Services Authority, and the Autorité des marchés financiers of Quebec.