Consultant Charged With Insider Trading
On September 23, 2015, the Securities and Exchange Commission (SEC) charged a consultant and his friend with insider trading in the options of P.F. Chang’s China Bistro based on nonpublic information about an impending acquisition offer.
The SEC claims that Richard G. Condon, a consultant to Panda Restaurant Group, tipped Jonathan Ross with confidential details about the bidding process for P.F. Chang’s that he learned while providing executive coaching services to Panda’s top management executives. Panda was involved in the bidding process, but did not ultimately make a tender offer for P.F. Chang’s.
According to the SEC’s complaint, Ross then purchased risky, out-of-the-money call options for P.F. Chang’s securities and tipped his friend Ali Sagheb so he could do the same. Ross, Sagheb, and a third trader immediately sold their options for a combined total of approximately $300,000 following a public announcement about the tender offer by a third party for ownership of P.F. Chang’s.
Sagheb has agreed to pay $19,829, which is the amount of his ill-gotten trading earnings plus interest. The SEC’s case continues against Condon and Ross in federal court in Los Angeles. The SEC’s complaint charges both men with violations of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934, and Rules 10b-5 and 14e-3 thereunder.
For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit www.securitieslawyer101.com. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.
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