SEC Charges Former Employee of China-Based Private Equity Firm with Insider Trading
ADMINISTRATIVE PROCEEDING
File No. 3-19959
September 3, 2020 - The Securities and Exchange Commission today announced settled insider trading charges against a former employee of a private equity firm for unlawfully trading in securities of a U.S.-based acquisition target while he was aware of material, non-public information about a forthcoming acquisition.
According to the SEC's order, while working for China-based Tahoe Investment Group Co., Ltd. as the Vice General Manager of Overseas Acquisitions, Yue Li learned details of Tahoe's efforts to acquire the remaining 49% of Alliance HealthCare Services, Inc. that it did not already own. The order finds that from February to April 2017, while aware of non-public information about the impending acquisition, Li purchased a total of 8,200 shares of Alliance Healthcare in his and a relative's brokerage accounts. According to the order, after Tahoe publicly announced the acquisition on April 11, 2017, Alliance Healthcare's share price rose nearly 27% and Li realized profits of $21,609.
The order finds that Li violated the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Without admitting or denying the findings, Li agreed to the entry of a cease-and-desist order against him and to pay a civil penalty of $43,218.
The SEC's investigation was conducted by Brianna Ripa and Andrew Elliott, and supervised by Amy Friedman and Carolyn Welshhans. The SEC appreciates the assistance of the Financial Industry Regulatory Authority.
Last Reviewed or Updated: Sept. 3, 2020