The long nights and drug addiction that drove a banker to insider trading

Femenia was a 28-year-old investment banker working for Wells Fargo when he tipped off his friends about confidential deals that the bank was working on. His friends would buy shares of companies that were in line to be acquired, reap the profits when the deals were announced and then kick back some of the gains to Femenia.

In two years, Femenia and his friends made more than $11 million trading off of confidential information, prosecutors said. He spent about three years in prison.

He says he came up with the scheme while he was abusing Adderall, which he started taking to deal with his long hours at Wells Fargo. The Wall Street Journal reported in December on the widespread use of ADHD medications on Wall Street and the psychological changes it causes in abusers.

‘I blame myself for what happened,’ Femenia says. ‘…But I honestly don’t think I would have gotten into trouble and made those choices if I didn’t take it.’

“I got an Adderall prescription to be able to work long hours and stay focused," the now-43-year-old Femenia said. “But it changed the person that I was while I was on it. This is a no-joke drug. It’s medical-grade meth."

Since getting out of prison in 2018, Femenia has built a life in the suburbs with his wife and two children and launched a real-estate lending business. But Femenia says his crimes will always be a Google search away. Instead of burying the past, he wants to warn others about how prescription drug abuse can upend lives and destroy careers.

“I blame myself for what happened," he said. “I was the one who willingly took Adderall. But I honestly don’t think I would have gotten into trouble and made those choices if I didn’t take it."

Life as a PowerPoint jockey

Femenia grew up on Long Island and was a good kid by his own account. He was an Eagle Scout who enrolled in the Merchant Marine Academy. After graduation, he served in the Navy reserves and spent years working on ships and boats in the Pacific Ocean. While working in the engine room of an oil tanker, he grew interested in finance and decided to go to business school.

At Columbia Business School, Femenia set his sights on Wall Street. His classmates warned him about the long hours in investment banking and talked about using Adderall (an amphetamine) to stay focused and work hard.

Femenia started working as an investment banker in 2009 at Wells Fargo, first in North Carolina and then in New York City.

The hours were immediately difficult for him. He says he was a “PowerPoint jockey" doing the grunt work of an investment banker from 9 a.m. until midnight, at least six days a week.

Femenia grew up on Long Island and became an Eagle Scout before going to the Merchant Marine Academy.

Even though he didn’t think he had attention-deficit hyperactivity disorder, Femenia soon got an Adderall prescription through a doctor who didn’t ask too many questions.

“I got psyched out after seeing people work these 18-hour days and all nighters and I thought, ‘I can’t do this without help,’" he said.

About a year later, he found another doctor who wrote him a second prescription. He was taking around 80 milligrams a day—twice the maximum daily dosage. He knew he was addicted and tried to quit several times, but the withdrawal symptoms were so strong that he couldn’t get out of bed and get to work. He kept on taking the pills.

The Adderall had made him frenetic, aggressive and willing to take new risks—a common occurrence when it comes to drug abuse.

“Once someone has an addiction, the part of their brain that helps them make good decisions literally gets turned off," said Samuel Glazer, a psychiatrist in Manhattan who has counseled several Wall Street bankers about substance abuse.

The insider trading ring

One night in 2010, while working late and high on Adderall, Femenia looked through some of the bank’s internal folders on a shared computer drive. He saw that project folders that were changed over the weekend were likely to be tied to live deals.

“My mind on Adderall would go off on these tangents and come up with elaborate schemes, and that’s really how it all began," Femenia said.

At the time, Femenia was on the hook for tens of thousands of dollars on a friend’s mortgage he had cosigned because the friend was struggling to pay.

Femenia told his friend to buy the shares of a company that he thought had a good chance of eventually being acquired. He enlisted another friend from college to buy the stock, too. Femenia’s friends netted north of $500,000 in profit from trading on the deal, according to court records.

‘It changed the person that I was while I was on it. This is a no-joke drug,’ Femenia said.

The scheme went on for about two years, and Femenia’s childhood friend used a shell company with a corporate bank account to buy and sell stock. Femenia says he didn’t know the full scale of the ring and received hundreds of thousands of dollars in kickbacks.

The biggest score was in 2012, when Femenia found out about Chicago Bridge & Iron’s $3 billion purchase of Shaw Group. Around 10 people connected to Femenia bought Shaw stock and call options in the weeks before the deal, according to court records. The day the deal was announced in July, the Shaw Group’s stock doubled. All in, the ring netted $7 million in profit, court records show.

After the announcement, Femenia’s childhood friend and the friend’s girlfriend wired more than $1 million to a precious-metals dealer in Manhattan to buy 550 gold bars. They flew to Las Vegas the next day and laundered more than $100,000 through a casino.

But the FBI was on their trail. Agents showed up on Femenia’s doorstep and told him they knew he was sharing confidential information and asked him to help their investigation. Femenia first slammed the door on them. Then he started cooperating.

Femenia was arrested in December 2012 and later pleaded guilty to five charges of fraud and money laundering in 2013. He reported for a five-year sentence at a federal penitentiary in 2015. Eight other co-conspirators did jail time, too.

Getting clean

When he checked in for his first day in jail, he brought a bottle of Adderall with him, but correctional staff told him he couldn’t keep the drugs. He said he spent two weeks in jail withdrawing from the drug, and it took over a year to stop craving it. Eventually, he shaved off 20 months through drug rehab and standard good behavior.

He said he still finds it hard to talk about his past with his friends and family because he was determined to start a new life for himself and his wife after prison.

“Every single day I reflect on what I did," Femenia said. “I still get angry with myself. But I figured out how to make money again, and I figured out how to do it against really bad odds. And I’m happy about that."

He said his message to people who are taking Adderall only to try to thrive on Wall Street is to stop before it’s too late.

“Taking this stuff on a consistent basis will alter your personality and decision-making," he said. “Do whatever you need to do to get off it. It doesn’t matter if you need to take a couple of weeks off. Do whatever you need to do." 

Write to Alexander Saeedy at alexander.saeedy@wsj.com