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.