U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 20491 / March 13, 2008
Securities and Exchange Commission v. John F. Marshall, Ph.D., et al., Civil Action No. 08-CV-2527 (S.D.N.Y., Mar. 13, 2008)
SEC Charges Vice Chairman of ISE Holdings and Business Partners With Insider Trading
Defendants Also Charged in Parallel Criminal Action
The Securities and Exchange Commission today filed an insider trading case against three individuals alleging illegal tipping and trading in advance of the April 30, 2007, announcement of Eurex Frankfurt A.G.'s $2.8 billion cash merger agreement with International Securities Exchange Holdings, Inc.
The defendants, John F. Marshall, Vice Chairman of ISE, Alan L. Tucker, of Yardley, Pa., and Mark R. Larson, of Miller Place, N.Y., were all partners in Marshall Tucker & Associates, LLC, a New York-based financial consulting partnership. The SEC's complaint alleges that Marshall received detailed and current information regarding the highly confidential ISE-Eurex merger talks, and tipped Tucker and Larson. According to the complaint, Tucker and Larson then purchased ISE securities resulting in illegal profits totaling approximately $1.1 million and $31,000, respectively.
Simultaneous with the filing of the SEC action, the U.S. Attorney's Office for the Southern District of New York announced the filing of a criminal complaint charging the three men with conspiracy to commit securities fraud.
The SEC complaint makes the following allegations.
The SEC's complaint alleges that each defendant violated the antifraud provisions of the Securities Exchange Act of 1934 - Section 10(b) of that Act and Rule 10b-5 thereunder. The complaint seeks permanent injunctions against future violations, disgorgement of unlawful trading profits plus prejudgment interest, civil penalties, and an officer and director bar against Marshall.
The Commission acknowledges the assistance of the U.S. Attorney's Office for the Southern District of New York, the Federal Bureau of Investigation, the Options Regulatory Surveillance Authority (ORSA), and the New York Stock Exchange (NYSE).
The Commission's investigation in this matter is ongoing.