Jan 14 A former Dow Chemical Co executive agreed to pay a $367,250 fine and be banned from serving as an officer or director of a public company to settle civil charges of insider trading over the 2008 takeover of Rohm and Haas Co.
Raymond James Financial Inc and one of its former brokers also agreed to settle related charges by the U.S. Securities and Exchange Commission. The regulator announced the settlements on Tuesday.
Mack Murrell, formerly Dow's vice president of information systems, had been accused of tipping his friend David Teekell about the planned $15.7 billion purchase of Rohm, a specialty chemicals company, before it was announced on July 10, 2008.
Murrell, of Saginaw, Michigan, learned about the transaction from his live-in girlfriend, who he later married, and who had been an assistant to Dow's chief financial officer, according to the SEC.
The regulator said Teekell and Charles Adams, his broker at Raymond James, then traded on the tips from Murrell, and that some profits went to Adams' customers. More than $1 million of illegal profit was realized, the SEC said.
In settlements approved on Monday by U.S. District Judge Thomas Ludington in Bay City, Michigan, Raymond James agreed to pay about $382,000 representing ill-gotten gains and interest, and Adams agreed to pay nearly $185,000, including a $107,046 fine. Murrell's settlement was also approved by Ludington.
Teekell previously agreed to pay about $1.17 million, including a $534,526 fine, to settle with the SEC.
None of the defendants admitted wrongdoing.
Lawyers for Murrell and Adams did not immediately respond on Tuesday to requests for comment. Raymond James did not immediately respond to a request for comment.
Raymond James is based in St. Petersburg, Florida. Dow is based in Midland, Michigan, and was not charged by the SEC.
The case is SEC v. Murrell et al, U.S. District Court, Eastern District of Michigan, 13-12856.