Georgia Doctor Settles SEC Suit
The U.S. District Court for the Northern District of Georgia entered a consent order requiring, among other things, that Defendant Dr. Bobby V. Khan, a Georgia-based doctor, pay more than double the amount of his trading profits obtained through alleged insider trading.
The US Securities and Exchange Commission filed charges against Dr. Bobby V. Khan in September 2010, alleging that he traded illegally in the stock of Georgia-based pharmaceutical company Sciele Pharma, Inc. on the basis of nonpublic information he received just days before the public announcement of a tender offer by a Japanese company to purchase all of that company’s shares.
Khan obtained confidential details about the acquisition from a longtime business associate and friend who was a senior officer at Sciele. Khan subsequently opened an online brokerage account for the first time in several years, transferred approximately one-third of his liquid net worth into it, and purchased 4,000 shares of Sciele stock just days before the tender offer’s public announcement. Khan sold all of his shares after the announcement for an illicit profit of $47,171.
Without admitting or denying the Commission’s allegations, Dr. Khan agreed, as set forth in the Court’s order, to pay a total of $100,857.79, consisting of disgorgement, prejudgment interest thereon, and a civil penalty.