(Reuters) - The Securities and Exchange Commission said it has filed a civil complaint against the chief executive of solid state drive-maker STEC Inc for insider trading in a secondary offering of his shares.
STEC’s CEO, Manouch Moshayedi, had information that a major customer’s demand for one of the company’s most profitable products was less than expected, the regulator said.
The SEC alleged that Moshayedi sought to take advantage of an upward trend in the stock price of STEC by selling a significant portion of his holdings and shares owned by his brother, who is also a company co-founder.
The company disclosed in 2009 that the SEC was conducting a formal investigation involving trading in the company’s securities.
STEC said last year the regulator was considering a civil injunction against the company, its CEO and president, following the investigation.
The SEC will not bring an enforcement action against the company or any of its other executive officers, STEC said in a statement.
The SEC complaint seeks to bar Moshayedi from serving as an officer or director of any registered public company.
Reporting by Neha Alawadhi in Bangalore; Editing by Matt Driskill