SEC al­leges in­sider trad­ing ahead of CNOOC-Nexen deal

The Pak Banker - - COMPANIES/BOSS -

WASHINGTON: The U.S. se­cu­ri­ties reg­u­la­tor filed a com­plaint in court against a firm con­trolled by a Chi­nese bil­lion­aire and other traders, ac­cus­ing them of mak­ing over $13 mil­lion from in­sider trad­ing ahead of a bid by China's CNOOC for Cana­dian oil com­pany Nexen Inc.

The Se­cu­ri­ties and Ex­change Com­mis­sion said the fed­eral court in Man­hat­tan had frozen as­sets worth over $38 mil­lion be­long­ing to Hong Kong-based Well Ad­van­tage, con­trolled by busi­ness­man Zhang Zhi­rong, and other un­named traders who used ac­counts in Hong Kong and Sin­ga­pore to trade in Nexen stock. They made trad­ing prof­its of $7 mil­lion and $6 mil­lion re­spec­tively by us­ing in­side knowl­edge of the merger to buy Nexen shares be­fore the an­nounce­ment, the SEC says. The trad­ing was sus­pi­cious, the SEC claims in its com­plaint, be­cause the ac­counts used to buy the shares had 'ei­ther no history or ex­tremely lim­ited history" of buy­ing Nexen shares be­fore July 2012. CNOOC said on July 23 it had agreed to ac­quire Nexen for $15.1 bil­lion, China's big­gest for­eign takeover bid. Shares of Nexen jumped al­most 52 per­cent that day.

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