Tuesday, May 8, 2007
The SEC obtained a TRO freezing the account of a Hong Kong couple who allegedly purchased 415,000 shares of Dow Jones common stock from April 13 through April 30, prior to the May 1 announcement of Murdoch's bid for the company, and then sold the shares on May 4 for approximately $8 million profit. The SEC papers (available at its website) provide no information about how the couple may have obtained inside information about the bid and rely on the highly suspicious nature of the purchases -- the large number of shares and the fact that the couple had never previously purchased Dow Jones stock. Most of the press reports have mentioned unusual trading in Dow Jones options, so we will await further news. See SEC v. Kan King Wong and Charlotte Ka On Wong Leung.