SEC Charges Three Sales Managers With Insider Trading Ahead of Major Acquisition
The Securities and Exchange Commission today charged three former sales managers at San Diego-based Qualcomm Inc. with insider trading ahead of a major acquisition announcement. The SEC alleges that Derek Cohen, Robert Herman, and Michael Fleischli learned through work e-mails that Qualcomm was planning a big announcement. A sales meeting later revealed that Qualcomm was negotiating an acquisition of Atheros Communications. Armed with the nonpublic information, all three sales managers purchased Atheros securities while exchanging a series of suspiciously-timed phone calls. As news leaked about the impending acquisition and the two companies subsequently announced it in a joint news release,…
Read MoreThree Software Company Founders to Pay $5.8 Million to Settle Charges of Insider Trading Ahead of Sale
The Securities and Exchange Commission today filed insider trading charges against three software company founders for taking unfair advantage of incorrect media speculation and analyst reports about the company’s acquisition. They agreed to pay nearly $5.8 million to settle the SEC’s charges. The SEC alleges that Lawson Software’s co-chairman Herbert Richard Lawson tipped his brother William Lawson and family friend John Cerullo with nonpublic information about the status of the company’s 2011 merger discussions with Infor Global Solutions, a privately-held software provider. Lawson Software’s stock price had begun to climb following media and analyst reports that the company was considering…
Read MoreSEC Announces Charges and Asset Freeze Against Hedge Fund Advisory Firm Distributing Falsified Performance Results
The Securities and Exchange Commission today announced fraud charges and an asset freeze against a New York-based investment advisory firm and two executives for distributing falsified performance results to prospective investors in two hedge funds they managed. The SEC alleges that Aphelion Fund Management’s chief investment officer Vineet Kalucha fraudulently altered an outside audit firm’s report reviewing the performance of an investment account he managed. Aphelion’s chief financial officer George Palathinkal allegedly learned about Kalucha’s falsifications, which essentially changed an investment loss into a major investment gain in the account. Nevertheless, the falsified report showing the phony gain instead of…
Read MoreSEC Charges Toronto-Based Consultant and Four Others in Reverse Merger Schemes Involving China-Based Companies
The Securities and Exchange Commission today charged a Toronto-based consultant and four associates with conducting illegal reverse merger schemes to bring a pair of China-based companies into the U.S. markets so they could manipulate trading and reap millions of dollars in illicit profits. The SEC alleges that S. Paul Kelley and three of the associates acquired controlling interests in two U.S. public shell companies in order to orchestrate reverse mergers with China Auto Logistics Inc. and Guanwei Recycling Corp. They then hired stock promoter Shawn A. Becker of Overland Park, Kan., and others to tout the two companies’ unregistered stock…
Read MoreSEC Charges Ohio-Based Investment Adviser and President for Fraudulently Hiding Account Shortfall
The Securities and Exchange Commission today announced fraud charges and an asset freeze against a Columbus, Ohio-based investment advisory firm and its president for repeatedly hiding a shortfall of more than $700,000 in client assets. According to the SEC’s complaint filed in U.S. District Court for the Southern District of Ohio, a shortfall in a money market fund account managed by Professional Investment Management (PIM) was discovered when the SEC conducted an examination of the firm to verify the existence of client assets. PIM reported in account statements sent to clients that the firm held a total of approximately $7.7…
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