By Nate Raymond
NEW YORK Jan 27 Two Hong Kong asset management
firms have agreed to pay $10.9 million to settle charges by the
U.S. Securities and Exchange Commission of insider trading ahead
of a bid by China's CNOOC for Canadian oil company
The proposed accord, disclosed in a court filing Monday,
would add to the more than $18 million the U.S. securities
regulator had previously secured in settlements as part of an
investigation into suspicious trading linked to the July 2012
China Shenghai Investment Management Limited and eight of
its clients including an individual named Stephen Wong have
agreed to give up nearly $4.27 million in profits realized
trading in Nexen stock.
CITIC Securities International Investment Management (HK)
Ltd, a joint venture between CITIC Securities International
Company Ltd and a company owned by China Shenghai's principal,
James Wang, has agreed to pay nearly $6.6 million in disgorged
profits and penalties.
The deal requires approval by U.S. District Judge Richard
Sullivan in New York, who later Monday signed off on the
settlement with CITIC.
Lawyers for CITIC and Wong declined comment, while a lawyer
for China Shenghai did not respond to a request for comment. A
spokesman for the SEC declined comment.
CNOOC announced July 23, 2012, that it agreed to acquire
Nexen for $15.1 billion in what became China's biggest foreign
takeover bid. Shares of Nexen climbed almost 52 percent that
Five day later, though, the SEC went to court and obtained a
court order seeking to freeze the assets of traders using
accounts in Hong Kong and Singapore to trade in Nexen.
More than $40 million in proceeds from suspicious Nexen
trading were subsequently frozen, the SEC said in the court
filing Monday, including $15 million in alleged illegal profits.
In the months that followed, defendants began reaching
settlements with defendants in the case.
In October 2012, Hong Kong-based Well Advantage agreed to
pay more than $14 million to settle the insider trading charges.
In March, Chinese businessman Ren Feng and his wife Zeng
Huiyu, previously cited as unknown traders charged in the
complaint, agreed to pay $3.3 million.
The case is Securities and Exchange Commission v. Well
Advantage Limited et al, U.S. District Court, Southern District
of New York, No. 12-5786.