"I cannot begin to apologize for my incredibly stupid actions. There is no excuse for my wrongful conduct," said Byran Shaw, who has been identified as a long-time friend and golf partner to Scott London, who was fired recently from his high-ranking position at KPMG, one of the country's largest accounting firms.
London, who had a lucrative 30-year career at KPMG, said the insider trading was done in the form of casual suggestions to his friend on what to buy or sell and that it started "as an effort to help out someone ... whose business was struggling."
But London also said in a statement, "What I have done was wrong and against everything that I had believed in."
"I spent nearly 30 years at KPMG and I dedicated my entire life to that firm," he added.
The New York Times reported Thursday that there was also, apparently, a profit motive for London, as the FBI photographed him accepting a cash payment for insider information at a Starbucks in the San Fernando Valley.
The Los Angeles Times reported that London was given $50,000 "in bags of cash."
London reportedly passed on information about nutrition supplement firm Herbalife and footwear manufacturer Skechers. A Securities and Exchange Commission complaint says the pair also traded information about Deckers Outdoor Corp., RSC Holdings and Pacific Capital.
"London was honored with the highest trust of public companies and he crassly betrayed that trust for bags of cash and a Rolex," SEC acting director of enforcement George Canellos said in a statement.
The firms involved now have to find new accounting firms and have previous financial statements audited a second time. Although KPMG said the previous audits were not manipulated, their integrity has been compromised and KPMG has withdrawn certification on the audits, the Times said.