According to the SEC’s complaint, filed in federal district court in California, Hong and Jiang generated profits of approximately $8.5 million by trading in the securities of Sagent in advance of a July 11, 2016 announcement about the company’s acquisition. The complaint alleges that the couple obtained confidential information about the acquisition directly or indirectly from a friend and neighbor whose company competed in the bidding process to acquire Sagent. According to the complaint, Hong and Jiang, who resided in California at the time of the trading but are now in China, attempted to evade detection by trading through accounts held in the names of relatives living in China. Between November 2015 and June 2016, these newly opened trading accounts amassed more than 1 million shares of Sagent stock. On multiple occasions, the defendants’ purchases made up greater than 20% of the total trading volume in Sagent stock on that trading day, which they sold immediately following the acquisition announcement.
‘Enforcement 40’ for 2020
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