A member of the index committee at S&P Dow Jones Indices (SPDJI) has been charged with being part of an insider trading scheme which led to more than $900,000 in profits.

According to Reuters, Yinghang Yang, also known as James Yang, was charged with one count of securities fraud for executing securities transactions through an unidentified co-conspirator based on non-public information between April and October 2019.

While working as a senior index manager at SPDJI, Yang gave inside information on when changes to the firm’s indices would be made.

He allegedly tipped an associate on when companies such as T-Mobile, Grubhub and others would be added or removed from SPDJI indices.

According to his LinkedIn profile, Yang, who joined SPDJI from JP Morgan in 2018, is a member of the index committee and is responsible for managing a wide range of US indices with more than $70bn of ETF and index funds assets tracking them.

These indices include the S&P Dividend Aristocrats, Dow Jones Select Dividend and Dividend 100 and the S&P Select Industry.

SPDJI said in a statement: "The employee has been suspended and we are cooperating with the authorities. The allegations describe behaviour that is contrary to our company’s code of conduct and deeply held ethical values. We hold our employees to the highest standards of honesty and integrity."

Questions remain as to what impact this will have on SPDJI long term and its decision to have a committee which has the discretion to include and remove companies from an index like an active manager who selects stocks to go into their portfolio.