SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16367 / November 22, 1999
SEC v. EURO SECURITY FUND, MARIO MERELLO, FABRIZIO PESSINA, COIM SA, FRANCESCO MAROTTA, PICTET & CIE-GENEVA, GIOVANNI PIACITELLI, PIERRE BOTTINELLI, RON SLEEGERS, INTERNATIONAL STRUCTURES CONSULTING B.V., URS HELLER, MRS. URS HELLER, MEINDERT PANAGIOTIS HAKKERT, FRANCK HAKKERT, H.J.M. DE BOER, C.J. BROEKEMA, E.H. VAN GEENEN, HENDRIK MARINUS BOUWMEESTER, HANS P. ROMANESKO, MRS. A. VERKAIK, AND ONE OR MORE UNKNOWN PURCHASERS OF COMMON STOCK OF ELSAG BAILEY PROCESS AUTOMATION, N.V., Civil Action No. 98 Civ. 7347 (S.D.N.Y.) (DLC, MHD)
SEC OBTAINS MORE THAN $500,000 FROM FOREIGN DEFENDANTS IN INSIDER TRADING CASE, INCLUDING SETTLEMENT WITH FORMER ABB ASEA BROWN BOVERI VICE PRESIDENT.
The Securities and Exchange Commission announced that on November 19, 1999, Judge Denise L. Cote of the U.S. District Court for the Southern District of New York signed final judgments in an insider trading case requiring, among other things, payment of more than $400,000 in settlement of the SEC's illegal insider trading charges against Ron Sleegers, a former vice president of Swiss-based ABB Asea Brown Boveri Ltd., and the Dutch company he owns.
The SEC's case involves allegations of illegal insider trading in the stock and call options on the stock of Netherlands-based Elsag Bailey Process Automation, N.V. during the weeks before the October 14, 1998 public announcement that ABB had agreed to make a cash tender offer for Elsag. The SEC alleges in an amended complaint filed on November 17, 1998, among other things, that (1) Ron Sleegers, then a vice president for ABB in Zurich, Switzerland, who was involved in formulating ABB's tender offer for Elsag; (2) International Structures Consulting, B.V., a Dutch company wholly owned by Sleegers; and (3) Astrid Verkaik, a personal friend of Sleegers', illegally purchased stock and call options on the stock of Elsag for more than $150,000 in advance of the October 14, 1998 announcement.
Without admitting or denying the SEC's substantive allegations, Sleegers, International Structures, and Verkaik consented to the entry of a final judgment permanently enjoining them from violations of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14e-3 thereunder, and requiring disgorgement of $408,938 in trading profits plus prejudgment interest of $26,871.53.
Independent of the settlements described above, Pierre Bottinelli, a registered representative for Schroder & Co., Inc. in Switzerland, was dismissed without prejudice as a defendant in this case.
In addition, a final judgment by default was entered against C.J. Broekema, a resident of the Netherlands, for failing to defend the SEC's action. The SEC alleged that Broekema illegally bought almost $50,000 worth of Elsag stock the day before the public announcement of ABB's tender offer. The judgment permanently enjoins Broekema from violations of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14e-3 thereunder, and requires disgorgement of $40,156.25 in trading profits plus prejudgment interest of $2,075.58, and a civil penalty of $56,018.83.
Euro Security Fund and Angelus Trading, Inc., two European-based investment funds, defendants in this or a related case, previously settled the SEC's insider trading charges involving Elsag stock purchases by consenting to the entry of final judgments requiring, among other things, payment of almost $11 million. See Litigation Release No. 16208 (July 12, 1999).
The SEC's litigation in this case continues against the remaining ten defendants and one or more unknown other persons or entities. For more information about this case see Litigation Release Nos. 15942 (October 20, 1998) and 15981 (November 19, 1998).http://www.sec.gov/litigation/litreleases/lr16367.htm