The Securities and Exchange Commission said today it charged a trio of individuals with insider training related to GE Healthcare‘s (NYSE:GE) purchase of cancer diagnostic company Clarient.
The individuals include a father, son and personal friend accused of abusing confidential information the father learned from a close friend working at 1 of the companies, according to the SEC.
The father, John McEnery III tipped off his son, John McEnery IV, and personal friend Michael Rawister of the acquisition, according to the SEC. The trio profited by more than $50,000 after Clarient stock price rose 33% on public announcement of the nearly $587 million acquisition.
“Individuals who obtain confidential information through a relationship of trust with a corporate insider are prohibited from using that information to trade securities. These traders violated such a trust by using highly-sensitive information to reap illicit trading profits,” SEC market abuse u acting co-chief Joseph Sansone said in a press release.
The 3 individuals charged agreed to pay approximately $170,000 combined to settle the charges, according to the SEC.