U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19327 / August 5, 2005
Securities and Exchange Commission v. Sonja Anticevic, 05 Civ. 6991 (KMW) (S.D.N.Y.)(August 5, 2005)
Court Freezes More Than $2 Million of Assets Linked to Suspicious Trades in Reebok Call Options Prior to Proposed Takeover Announcement
In an emergency federal court action filed today, the Securities and Exchange Commission obtained a court order freezing a securities account in the name of Sonja Anticevic ("Anticevic"), a Croatian national and resident. The Anticevic account engaged in a series of highly suspicious, and highly profitable, trades in "out of the money" call options of Reebok International Ltd. ("Reebok") just prior to Reebok's August 3, 2004 announcement that it had agreed to be acquired by adidas-Salomon AG.
The Commission's Complaint alleges:
Anticevic bought the options through an account maintained at CyberTrader, Inc. ("CyberTrader"), a Texas-based subsidiary of Charles Schwab & Co. Inc. Over the course of two days, August 1 and August 2, 2005, the Anticevic account purchased a total of 1,997 out-of-the-money call options for the shares of Reebok at a cost of approximately $130,000.
The acquisition transaction was announced prior to the opening of the market on Wednesday, August 3, 2005. When Reebok opened for trading on August 3, the price of Reebok's common stock rose by nearly 30% from the previous day's closing price, opening at $57.40, an increase of over $13.45 per share. On August 3, the Anticevic account sold all of the call options, realizing profits of over $2.04 million.
On August 3, 2005, shortly after her sale of the call options, CyberTrader received a wire instruction request to transfer approximately $870,000 from the account to an account in Salzburg, Austria.
As a result of the foregoing, the Commission alleges that Anticevic engaged in illegal insider trading in violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The complaint seeks permanent injunctive relief, the disgorgement of all illegal profits, and the imposition of civil monetary penalties.
Among other relief, the Court's Temporary Restraining Order freezes the proceeds from the Reebok transactions. In addition, the Order imposes an expedited discovery schedule and prohibits the defendant from destroying documents.
The Commission acknowledges the assistance of the Philadelphia Stock Exchange.