SEC Files Another Insider Trading Suit Vs 3 Swiss Firms

Jack Humphrey, Regulatory journalist
January 16, 2012 /

The Securities and Exchange Commission has filed an amended complaint in a pending action against three Swiss-based entities previously charged with insider trading.

On July 15, 2011, the Commission filed a complaint charging defendants Compania International Financiera S.A., Coudree Capital Gestion S.A., and Chartwell Asset Management Services with insider trading in violation of Section 10(b) of the Exchange Act, alleging that the defendants traded ahead of a July 11, 2011 public announcement that Swiss-based Lonza Group Ltd. would acquire Connecticut-based Arch Chemicals, Inc.

On July 18, 2011, the federal agency said it has obtained asset freezes and other emergency relief against three Swiss-based entities.

According to its complaint, the three firms purchased more than a million common shares of Arch between July 5 and July 8, mostly in accounts based in London, England. Immediately after the acquisition announcement on July 11, the firms began selling the recently-purchased shares of Arch common stock for millions of dollars in profits.

The SEC filed an amended complaint adding an additional claim for relief under the tender offer antifraud provisions of the Exchange Act, specifically Section 14(e) and Rule 14e-3 thereunder.

The SEC amended its complaint because the Lonza acquisition of Arch Chemicals was in the form of a tender offer. The SEC’s amended complaint now charges the defendants with violating Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5 and Rule 14e-3.

The amended complaint seeks permanent injunctions, disgorgement of illegal trading profits plus prejudgment interest, and civil monetary penalties.

The Commission’s action remains pending.


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