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Sarbanes-Oxley News & Developments
Ex-FleetBoston Exec ChargedSEC says Guillermo Garcia Simon and family members profited from illegal inside trading.
> > A former FleetBoston Financial Corp. employee in Argentina used insider information in a bid to illegally profit from the sale of the company to Bank of America Corp.,say U.S. securities regulators.
The SEC typically takes months and sometimes years to bring action against insider trading cases. In this case the commission acted within days of the alleged infraction. The SEC accused Guillermo Garcia Simon and family members of buying FleetBoston securities late friday, before the announcement monday that Bank of America would buy the Boston based bank in what would be the second-biggest U.S. bank merger.
A federal judge in Boston granted the request of the SEC to freeze the defendents brokerage account and stop them from transfering or selling the call options. Garcia Simon had not worked for the company for over a year and the bank had no reason to suspect that a current employee might be involved, Fleet said they are cooperating with the SEC. The SEC declined speculation how Garcia Simon, his wife and his brother were able to get the insider information about the sale.
The SEC was tipped off to the case after the American Stock Exchange noticed unusual trading volumes in Fleet securities.
Source: CNN Money
Published:2003-10-29
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