The Securities and Exchange Commission has settled an insider trading case against Jon P. Kipp, a Kirkland, Washington resident who sold his entire Funko stake after receiving a confidential warning from the company’s then-chief executive. Kipp agreed to pay 1,073,009 dollars in disgorgement, interest, and civil penalties, according to a settlement filed in federal court.
The case, announced in Litigation Release No. 26640 on September 15, 2026, shows how a single text message between longtime friends turned into a seven-figure enforcement action. It also shows how regulators can reconstruct private conversations years after the fact.
What happened
The SEC filed its settled action on September 14, 2026, in the U.S. District Court for the Western District of Washington, Case No. 26-cv-03289. The complaint centers on Funko’s July 13, 2023 announcement that its then-CEO would take a leave of absence and cease serving as chief executive.
Two days before that announcement, according to the SEC, the CEO sent Kipp a text message. The executive revealed that Funko’s board of directors had placed him on a sabbatical and that he planned to leave the company permanently. The two men had been close personal friends for decades and had worked together at Funko before Kipp retired several years earlier.
Kipp acted on the message immediately. On the morning of July 13, 2023, he sold all 247,335 Funko shares he owned. Funko’s stock price fell the day after the announcement, and the SEC calculates that his timing helped him avoid approximately 483,746 dollars in losses.
Key facts in the SEC’s case against Jon P. Kipp
| Detail | Information |
|---|---|
| Defendant | Jon P. Kipp, Kirkland, Washington |
| Court and case number | W.D. Wash., No. 26-cv-03289 |
| SEC release | Litigation Release No. 26640, September 15, 2026 |
| Shares sold | 247,335 Funko shares |
| Losses avoided | Approximately $483,746.40 |
| Disgorgement | $483,746.40 |
| Prejudgment interest | $105,516.93 |
| Civil penalty | $483,746.40 |
| Total monetary remedies | $1,073,009.73 |
The civil penalty matches the losses avoided dollar for dollar. That one-to-one structure is a common feature of settled insider trading actions, and it sits on top of disgorgement and interest rather than replacing them. Kipp consented to the judgment without admitting or denying the SEC’s allegations, and the settlement remains subject to court approval.
Funko shareholders and the impact of the trade
Funko, the pop-culture collectibles company behind the Pop! vinyl figure line, trades on the Nasdaq under the ticker FNCO. Small-cap stocks are especially sensitive to leadership news, and a surprise chief executive exit can erase months of gains in a single session.
Kipp held nearly a quarter of a million shares. Selling them ahead of the announcement, rather than after it, preserved close to half a million dollars in value.
Ordinary shareholders had no such warning. Investors who held Funko through the announcement absorbed the decline on public information alone, while one person inside the company’s personal network traded with an edge the market never saw. That asymmetry is exactly what securities law prohibits. The SEC’s San Francisco Regional Office led the investigation, which the agency credits to Duncan C. Simpson LaGoy with assistance from Russell R. O’Brien, under the supervision of Chrissy Filipp, Rahul Kolhatkar, and Jason H. Lee.
What investors should do
First, a clarification that matters for expectations. The money Kipp pays goes to the government, not into a fund for Funko shareholders. Investors who held the stock in July 2023 are not claimants in this enforcement action, and the settlement creates no mechanism for them to recover market losses.
Second, the case is a reminder about private conversations. The tip at the center of this case was a text message between two old friends, not a board memo or a filing. Insider trading exposure does not depend on formal channels, and neither does detection.
Third, the enforcement tail is long. The SEC reconstructed a July 2023 trade and filed charges more than three years later, in September 2026, using records the market generates every day. Investors reviewing their own history with a financial professional should assume the same permanence.
How to recover your losses
Losses from news-driven market declines are generally not recoverable through arbitration. But investors whose losses stem from a financial professional’s misconduct — unsuitable recommendations, churning, misrepresentation, or unauthorized trading — can pursue recovery through FINRA arbitration.
Arbitration claims are subject to strict eligibility rules and filing deadlines. Waiting too long can forfeit otherwise strong claims, which is why an early review of account statements and trade history matters.
Haselkorn & Thibaut fights for investor recovery
Haselkorn & Thibaut is a securities law firm founded by former Wall Street defense attorneys who shifted their practice to represent investors. The firm has recovered over $520 million for clients in securities matters and maintains a 98 percent success rate in resolved nontraded REIT cases. Attorneys are AV Preeminent rated through Martindale-Hubbell, designated as Super Lawyers, and hold a 5.0-star client review average. The firm operates on a contingency basis — no recovery, no fee.
Contact Haselkorn & Thibaut today
Time matters in securities fraud cases. The earlier you act, the stronger your position. The firm offers a free case evaluation to assess your losses, review your account history, and explain your options under arbitration or settlement.
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