WASHINGTON, D.C. — A former president and chief operating officer of an Idaho-based public company has pleaded guilty to insider trading after prosecutors say he used confidential corporate information to profit from an upcoming acquisition, according to the U.S. Department of Justice.

Federal court documents state that Michael Smith, 48, of Eagle, served as President and COO of “Company-1,” a NASDAQ-listed Idaho firm, beginning in June 2022. By mid-2024, Smith had access to material nonpublic information (MNPI) regarding the company’s impending acquisition.

Despite being bound by the company’s insider trading policy, prosecutors say Smith purchased Company-1 stock on July 26, 2024, using a brokerage account belonging to an individual with whom he had a close personal relationship. The trades were made while he possessed confidential details about the acquisition.

When the acquisition was publicly announced on Aug. 7, 2024, Company-1’s share price rose nearly 50%. Smith sold the stock the next day, generating a profit of approximately $145,754 for the account holder, according to the Justice Department.

Smith has pleaded guilty to one count of securities fraud. He faces a maximum sentence of 20 years in federal prison. A district court judge will determine his final sentence after reviewing federal sentencing guidelines and other statutory considerations.

The case is being investigated by the U.S. Postal Inspection Service Criminal Investigations Group. Trial Attorneys Kyle Crawford and John Liolos of the Justice Department’s Fraud Section, along with Assistant U.S. Attorney Sean Mazorol for the District of Idaho, are prosecuting the case.