Investment Analyst Surrenders in Insider Trading Case

A former Morgan Stanley Dean Witter & Co. analyst, who fled from federal authorities after being charged with illegal insider trading, surrendered to officials Tuesday in San Francisco, the FBI said.

Brett S. Henderson, who worked in Morgan Stanley’s investment banking and corporate finance division in Silicon Valley until he was fired last month, turned himself in to the FBI one day after evading arrest by federal agents who had arrived at his Mission district home in San Francisco.

“He came in and gave himself up,” said FBI spokesman George Grotz in San Francisco. “He was processed by a case agent here, photographed and fingerprinted and taken to a U.S. magistrate.”

Henderson, 25, and longtime friend Richard F. Randall, 27, face charges of illegally trading stock or options in nine companies--many of them Morgan Stanley clients. Henderson had worked in the firm’s Menlo Park office for less than a year, and allegedly provided Randall with inside information that made both men about $54,000 in profits.

Investigators allege that Henderson, who joined Morgan Stanley in September, devised his scheme even before he started his job as a Morgan analyst.

Randall, a high school teacher living in Urbana, Ohio, had already been arrested. Henderson was released on a $50,000 signature bond; his preliminary hearing is scheduled for Aug. 23.

Each faces a maximum sentence of five years in prison and $250,000 in fines if convicted. The Securities and Exchange Commission also has filed a civil complaint, seeking civil penalties of up to three times their trading profits, and other sanctions.

Neither Henderson nor Randall were available for comment.