Employee of H. Ross Perot Arrested On Insider Trading Charges
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Price: $434.78 --0%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 0.7%
EPS Growth %: +109.9%
Overall Analyst Rating:
SELL (= Flat)
Dividend Yield: 0.7%
EPS Growth %: +109.9%
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The SEC charged Reza Saleh with insider trading based on his alleged knowledge of Dell's (Nasdaq: DELL) takover of Perot Systems (NYSE: PER).
Prior to Dell announcing its buyout of Perot, Reza made increasingly large purchases of Perot Systems call options based on information he learned while working for H. Ross Perot's (former Presidential candidate) investment firm, Parkcentral Capital Management LP. Reza sold all of his call options immediately following the tender offer, which resulted in $8.6 million in profits for him.
Saleh has worked for various Perot entities and sometimes attended Perot Systems planning meetings, the SEC alleged. The SEC said Saleh spoke with a director of Perot Systems, who is not identified and not accused of wrongdoing, weeks before the deal was announced to the public. The SEC did note that another Perot Systems director is also an officer of Parkcentral.
The agency says that Saleh began asking questions about the potential deal on or around September 8 to the PER director and that his questions demonstrated he knew the deal would be done at a premium to Perot's share price. The conversation with the director, the SEC said, "confirmed" to Saleh that the deal was moving forward.
Soon after hearing that news, Saleh began buying call options on Perot's stock soon. Saleh purchased 9,332 Perot Systems call option contracts through two brokerage accounts between September 4 and September 18, 2009. The call option contracts were set to expire in October 2009 and January 2010.
The SEC contacted Saleh on Monday, and, the SEC says, Saleh then told the director that he traded based on his knowledge of the takeover talks. Saleh told the director that nobody told him about the deal but "he put the pieces together prior to his trading."
Prior to Dell announcing its buyout of Perot, Reza made increasingly large purchases of Perot Systems call options based on information he learned while working for H. Ross Perot's (former Presidential candidate) investment firm, Parkcentral Capital Management LP. Reza sold all of his call options immediately following the tender offer, which resulted in $8.6 million in profits for him.
Saleh has worked for various Perot entities and sometimes attended Perot Systems planning meetings, the SEC alleged. The SEC said Saleh spoke with a director of Perot Systems, who is not identified and not accused of wrongdoing, weeks before the deal was announced to the public. The SEC did note that another Perot Systems director is also an officer of Parkcentral.
The agency says that Saleh began asking questions about the potential deal on or around September 8 to the PER director and that his questions demonstrated he knew the deal would be done at a premium to Perot's share price. The conversation with the director, the SEC said, "confirmed" to Saleh that the deal was moving forward.
Soon after hearing that news, Saleh began buying call options on Perot's stock soon. Saleh purchased 9,332 Perot Systems call option contracts through two brokerage accounts between September 4 and September 18, 2009. The call option contracts were set to expire in October 2009 and January 2010.
The SEC contacted Saleh on Monday, and, the SEC says, Saleh then told the director that he traded based on his knowledge of the takeover talks. Saleh told the director that nobody told him about the deal but "he put the pieces together prior to his trading."
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