The U.S. Securities and Exchange Commission
("SEC") recently reaffirmed its
determination to hold those involved in market abuse violations
accountable. To illustrate, the following three charges are
On 10 February 2012, the SEC announced that it was charging yet
another person in the Galleon insider trading case involving Raj
Rajaratnam. Numerous defendants have been charged in the Galleon
insider trading case to date. This time it concerned a managing
member of hedge fund investment adviser Whitman Capital LLP and his
firm for violating insider trading prohibitions. Allegedly, Whitman
traded in the listed securities based on non-public information
which he received from a former employee of the Galleon Group hedge
A second insider trading case involves unlawful trading by a
former vice-president of Coca Cola. On 8 March 2012, the SEC filed
a charge in which it claimed that the former VP allegedly used
non-public information about an imminent acquisition by the company
to purchase securities of Coco Cola Enterprises on the day before
the acquisition. According to the SEC the former VP misappropriated
the material non-public information, whereas he had a relationship
of trust and confidence with the company, was regularly in
possession of sensitive and confidential information and also
signed a non-disclosure agreement confirming that he would maintain
Another example of the SEC's focus on market abuse
violations is the charge against BankAtlantic Bancorp and its CEO
on 18 January 2012. The charges inter alia include accounting fraud
and misleading investors about BankAtlantic Bancorp's real
estate portfolio at the time that the real estate market
floundered. According to the SEC, Bancorp presented misleading
information on earning calls in 2007 to conceal losses in its real
estate portfolio. Furthermore, BankAtlantic Bancorp allegedly filed
incorrect reporting statements.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
The U.S. Court of Appeals for the Second Circuit yesterday affirmed the fraud conviction of a registered investment adviser and held that proof of intent to harm is not an element of a criminal conviction...
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).