Federal criminal and civil charges were filed Thursday against former KPMG partner Scott London and his friend who allegedly traded on insider information about KPMG clients that included Herbalife Ltd. and Skechers USA Inc.

In a criminal complaint filed in federal court in Los Angeles, the U.S. Attorney’s Office charged London of Agoura Hills with one count of conspiracy to commit securities fraud through insider trading. The complaint alleges that London provided confidential client information to Bryan Shaw of Lake Sherwood during several years, which Shaw allegedly used to make securities trades.

London was a senior partner at KPMG. He supervised more than 500 accounting professionals at the firm and personally handled audits for major clients. He has acknowledged receiving money and gifts from Shaw, a longtime friend and golfing partner. As part of the government’s investigation, Shaw agreed to cooperate with federal authorities and recorded conversations with London.

The U.S. Securities and Exchange Commission announced it had filed civil charges against both London and Shaw. The complaint alleges several violations of U.S. securities laws, and seeks to have the men turn over any “ill-gotten gains” plus pay fines and penalties.

The federal criminal charge carries a statutory maximum penalty of five years in prison and a fine of $250,000, or twice the gross gain or loss from the offense.

Shaw allegedly paid London at least $50,000 in cash, which usually was delivered in bags outside of Shaw’s Encino jewelry store, according to the SEC complaint. Shaw also gave London a Rolex watch, jewelry, meals and tickets to entertainment events.

KPMG on Monday said that it fired London after he informed the firm that he was under investigation. The Big Four accounting firm also resigned as the auditors for Herbalife Ltd. and Skechers.

According to published reports, the investigation began when Shaw’s trades were flagged as suspicious.