LawFuel – The Law Newswire – The U.S. Securities and Exchange Commission sued a Hong Kong couple for using inside information to make $8.2 million from purchases of Dow Jones & Co. stock before News Corp.’s $5 billion bid for the company, Bloombergs report.
Kan King Wong and Charlotte Ka On Wong Leung bought 415,000 shares valued at more than $15 million in April before the bid by Rupert Murdoch’s New York-based media company became public May 1, the SEC said in a civil lawsuit filed at Manhattan federal court today. Dow Jones’s stock price jumped 55 percent the day the offer was announced.
“This is an insider trading case involving highly profitable and highly suspicious purchases” of Dow Jones shares, the SEC wrote in a court filing. “Defendants acquired a massive position,” exceeding their earlier bets, it said.
The case is at least the third since March in which U.S. regulators have targeted foreign investors’ trading before U.S. takeover bids. The SEC sued a Credit Suisse Group banker May 3 for allegedly feeding tips on nine transactions to investors in Pakistan. In March, the agency accused a London couple of using secret knowledge for trades before of a $32 billion bid for TXU Corp.