The Securities and Exchange Commission charged an ex-Goldman Sachs employee for abusing knowledge of confidential information on the bank’s trading system on a retail exchange traded fund (ETF).

Former Goldman trader, Spencer Mindlin, was charged with insider trading after tipping off his father, Alfred Mindlin, about Goldman’s hedging plays pegged to the SPDR S&P Retail ETF (NYSEArca: XRT), reports Kara Scannell for Financial Times.

The SEC claims the two made $57,000 in illegal profits on trades in late 2007 and early 2008.

“This is a situation where a son working in the securities industry suggested a trading strategy to his father and helped the father understand and execute the strategy,” Robert Knuts, a lawyer for the two defendants, commented. “It is based on the well-known rebalancing phenomenon within the ETF industry and publicly available information.”

“With his father’s helping hand, Spencer Mindlin exploited his inside knowledge of Goldman’s complex hedging strategies to line his own pockets,” George Canellos, director of the SEC’s New York regional office, stated, reports Joe Morris for Ignites.

Max Chen contributed to this article.

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