CEO's Secret Text Triggers $483K Stock Sell-Off!

SEC v. Jon P. Kipp — U.S. Securities and Exchange Commission Litigation Release No. 26640, dated September 15, 2026.

The SEC charged Jon P. Kipp with insider trading for selling all his Funko shares before a negative announcement. Kipp learned about the CEO's impending leave of absence from the CEO himself, a close personal friend. He then sold his shares, avoiding significant losses when the stock price dropped.

In Plain English

Imagine your friend, who is the boss at a company, tells you privately that they are going to leave the company soon. You know this news will make the company's stock price go down. So, before the news becomes public, you sell all the stock you own in that company to avoid losing money. This is what Jon Kipp allegedly did, and the SEC said it was illegal insider trading.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. A Close Friendship and a Confidential Tip Jon P. Kipp and the CEO of Funko, Inc. were long-time friends who had even worked together previously. On July 11, 2023, the CEO confided in Kipp via text message that the Funko Board of Directors had placed him on a mandatory sabbatical and that he planned to leave the company permanently.
2. Kipp Sells Funko Shares Two days later, on the morning of July 13, 2023, Kipp acted on this material nonpublic information. He sold all 247,335 Funko shares he owned.
3. Funko's Announcement and Stock Drop Later on July 13, 2023, Funko publicly announced that its CEO would be taking a leave of absence and ceasing to serve as CEO. The following day, Funko's stock price fell approximately 19 percent, from $10.07 to $8.15 per share.
4. Loss Avoidance By selling his shares before the announcement and subsequent price drop, Kipp avoided approximately $483,746.40 in losses.

The Enforcement Action

On September 14, 2026, the SEC filed a settled action against Jon P. Kipp in the U.S. District Court for the Western District of Washington. Kipp was charged with insider trading in advance of Funko, Inc.'s July 13, 2023 announcement regarding its CEO's leave of absence. Without admitting or denying the allegations, Kipp consented to a final judgment permanently enjoining him from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The judgment also ordered Kipp to pay $483,746.40 in disgorgement, $105,516.93 in prejudgment interest, and a $483,746.40 civil penalty, totaling $1,073,009.73 in monetary remedies.

Named in this action: Jon P. Kipp.

Original SEC litigation release ↗ · Browse all cases