SEC Charges Three Canadians In $1 Million Insider Trading Scheme
June 10 2009 - 12:07PM
Dow Jones News
The U.S. Securities and Exchange Commission filed civil charges
Wednesday against three Canadians, including the spouse of an
administrative assistant in Merrill Lynch & Co.'s Canadian
unit, in an insider-trading scheme that allegedly generated more
than $1 million in ill-gotten gains.
The lawsuit, filed in U.S. District Court in Manhattan, alleges
Michael Goodman, 36 years old, of North York, Ont., learned
information concerning proposed business combinations from
confidential conversations with his wife, who had learned of the
deals through her employment at Merrill Lynch Canada Inc.
The wife worked for Merrill Lynch between January and June 2005,
the SEC said.
"Goodman's wife expected that her husband would keep this
information confidential and believed that her husband understood
that the conversations concerning those companies were
confidential," the SEC said.
Goodman, who works at a scrap metal company, allegedly shared
that information with two business associates - Phillip Macdonald,
a self-employed attorney and friend of Goodman's, and Martin
Gollan, a scrap metal dealer, the SEC said.
Gollan, 63, of Thornhill, Ont., and Macdonald, 48, of North
York, then purchased securities in several companies involved in
deals in which Merrill acted as an advisor or provided fairness
opinions.
The deals included Eastman Kodak Co.'s (EK) acquisition of Creo
Inc., Novartis AG's (NVS) merger with Eon Labs Inc., and GameStop
Corp.'s (GME) acquisition of Electronics Boutique Holdings Corp. in
2005.
-By Chad Bray, Dow Jones Newswires; 212-227-2017;
chad.bray@dowjones.com