SEC Charges Company Executive With Insider Trading

The Securities and Exchange Commission today charged an executive at Stamford, Conn.-based electronics company Harman International Industries with insider trading in the company’s stock.

The SEC alleges that Dennis Wayne Hamilton made more than $130,000 in illegal profits by trading on nonpublic information he learned on the job in advance of Harman’s release of its fiscal year 2014 first quarter earnings.  

In a parallel action, the U.S. Attorney’s Office for the District of Connecticut today announced criminal charges against Hamilton.

“We allege that Hamilton traded on details known only to company insiders and took advantage of the stock market’s fair and level playing field,” said Sharon B. Binger, Director of the Philadelphia Regional Office. 

According to the SEC’s complaint filed in U.S. District Court for the District of Connecticut:

• In his role as Harman’s vice president of tax, Hamilton reviewed Harman’s earnings and learned the company would report stronger-than-expected results for its FY14 first quarter, which spanned from July 1 to Sept. 30, 2013. 
• The day before Harman publicly released the financial results, Hamilton purchased 17,000 shares of Harman stock at a cost of more than $1.2 million.  He liquidated his position when the quarterly results were publicly announced. 
• Harman’s stock price rose more than 12 percent on the news and Hamilton’s illicit trading produced one-day profits in excess of $130,000.

The SEC’s continuing investigation is being conducted by Suzanne C. Abt, Jacquelyn King, Daniel Koster, and Scott A. Thompson of the Philadelphia Regional Office.  The case is being supervised by G. Jeffrey Boujoukos.  The SEC’s litigation will be led by David L. Axelrod and Mark Sylvester.  The SEC appreciates the assistance of the U.S. Attorney’s Office for the District of Connecticut and the Federal Bureau of Investigation.