SEC Announces Fraud Charges Against Victory Ho
On July 12, 2017, the Securities and Exchange Commission (“SEC”) announced fraud charges against Victory Ho for insider trading in the securities of The Shaw Group, Inc. (Shaw), a Louisiana-based energy construction company, ahead of a public announcement on July 30, 2012 that Shaw was going to be acquired by Chicago Bridge & Iron Company N.V.
The SEC’s complaint, filed in the U.S. District Court for the Western District of Louisiana, alleges that during July of 2012, Victory Ho obtained confidential non-public information about the impending Shaw merger. Ho then used all of the money in a newly-opened brokerage account – about $8000 – to purchase 296 Shaw short term call options on Friday, July 27, 2012, the last trading day before the public announcement of the merger. Prior to purchasing these options, Victory Ho had multiple communications with two individuals who had personal relationships with a Shaw employee who had information concerning the merger. The SEC further alleges that Ho sold the options shortly after the announcement of the acquisition for a profit of approximately $295,000.The SEC’s complaint charges Ho with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and seeks a final judgment imposing a permanent injunction, disgorgement of his profits, pre-judgment interest and a civil penalty.
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