Securities: company employee charged with insider trading.
The USA's Securities and Exchange Commission has moved with unlikely speed in bringing an action against Reza Saleh, an employee of Perot Systems relating to the offer by Dell Inc. made public just two days before the action was launched.
The SEC alleges that Saleh made increasingly large purchases of Perot Systems call options contracts based on material, non-public information that he learned in the course of his employment with, or duties for, two Perot-related private companies and Perot Systems. Immediately following the tender offer announcement on Monday, September 21, Saleh sold all of the call option contracts in the accounts and reaped approximately USD8.6 million in illicit profits.
That same morning, a suspicious transaction report highlighted Saleh's activity to both the SEC and the Options Regulatory Surveillance Authority who immediately commenced an investigation.
The SEC interviewed Saleh who, after questioning, admitted that he "knew about the impending transaction when he traded."
The SEC is now seeking an order to freeze Saleh's assets.
According to the SEC's complaint, filed in federal court in Dallas, Saleh purchased 9,332 Perot Systems call option contracts through two brokerage accounts between 4 September and 18 September, 2009. The call option contracts were set to expire in October 2009 and January 2010. Saleh sold all of the call options following the announcement as Perot Systems' stock price immediately increased by approximately 65 percent.
The SEC's complaint also names Amir Saleh of Richardson, Texas, as a "relief defendant," in order to recover trading profits he received as a co-account holder on one of Reza Saleh's brokerage accounts.
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