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Man who took insider tips, says he was 'stupid'

Christina Rexrode, AP Business Writer

NEW YORK (AP) -- The accountant and the jeweler were longtime friends and golf partners. But the accountant was passing private information about two companies to the jeweler, who used it to play the stock market. Now they're both under federal investigation, their reputations unraveling on a very public stage.

The scandal over a KPMG accountant passing information about client companies Herbalife and Skechers has unfolded in pieces this week. Late Monday KPMG announced it fired a partner in Los Angeles who leaked nonpublic information about companies that KPMG worked with. On Tuesday nutritional supplement maker Herbalife and shoe seller Skechers announced that they were the companies whose information was leaked. On Wednesday the fired KPMG partner, Scott London, publicly identified himself through his lawyer and issued a statement saying he deeply regretted his actions and was just trying to help a friend.

Thursday brought one of the remaining pieces of the puzzle. Bryan Shaw identified himself as the friend who got insider information from London.

In a statement through his lawyer, Nathan Hochman, Shaw said he received information from London "about a number of companies" from 2010 to 2012. He said he had "profited substantially" from trading stocks based on that information, but he didn't provide details.

"I cannot begin to apologize for my incredibly stupid actions," said Shaw, who runs a wholesale jewelry company. "There is no excuse for my wrongful conduct. I accept full and complete responsibility for what I have done and know that I will spend the rest of my life trying to make up for my tragic lapses of judgment."

Shaw paid London for the information, but it isn't clear how much. London's lawyer Harland Braun has said it was "about $25,000" over several years.

London said in his statement that he never leaked any documents. He described the interactions as his friend asking whether a stock was a good buy and London offering suggestions.

The FBI, the Justice Department and the Securities and Exchange Commission are investigating. Lawyers for Shaw and London said their clients are cooperating.