Tuesday, June 19, 2007
We've seen a number of insider trading cases involving married couples, and here's another one:
On June 18, the SEC filed a settled civil action in federal district court against Terese Dearmin (Dearmin) and her father Richard Harris (Harris), alleging violations of federal securities laws in separate instances of insider trading in the securities of U.S. Home & Garden, Inc. (USHG) ahead of the public announcement of its merger with Ionatron, Inc. (Ionatron). The Commission's complaint alleges that Dearmin learned from her husband, the former CEO of a privately-held company called Ionatron, that it would merge with USHG approximately one month prior to the Feb. 25, 2004, public announcement of the merger. Dearmin tipped Harris, her mother, and her business partner, according to the complaint, and all three purchased USGH stock in advance of the merger announcement. Without admitting or denying the allegations in the complaint, Dearmin and Harris consented to entry of a final judgment that imposes an injunction, disgorgement of profits, and penalties.