Two Hong Kong asset management firms will pay $11 million US in settlement charges over an insider trading case involving the takeover of Canadian energy company Nexen.
In July 2012 CNOOC agreed to pay $15 billion Cdn or $27.50 per Nexen share for the Calgary oil and gas company, a 67 per cent premium on the share price.
The U.S. Securities and Exchange Commission says foreign traders bought Nexen stock in the week ahead of its takeover by China-based CNOOC Ltd., earning more than $13 million US in potentially illicit profits.
By freezing assets at the management firms that handled the trades, the SEC was able track down and identify the traders, setting the stage for a string of settlements by firms and individuals.
The SEC said it has recouped nearly $30 million US in insider trading settlements related to Nexen.
CITIC Securities International Investment Management Ltd. agreed to pay $6.6 million and China Shenghai Investment Management Ltd. is to pay $4.3 million in a deal approved by a U.S. judge on Tuesday, the SEC says.
The settlement is not an admission of wrongdoing. The SEC said it worked with foreign regulators to investigate.
Other traders nabbed in the past year in the Nexen case included:
- Well Advantage, a Hong Kong firm that agreed to a $14.2 million settlement.
- A Chinese businessman and his wife who agreed to a $3.3 million settlement.
- A Singapore businesswoman who agreed to a $566,000 settlement.