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Last Updated: Wednesday, 9 May 2007, 07:45 GMT 08:45 UK
Two sued in Dow Jones share trade
Copy of Wall Street Journal
US regulators have accused a Hong Kong couple of insider trading
US regulators have accused a Hong Kong couple of using insider information to profit from a $5bn (2.5bn) takeover bid for Dow Jones.

The US Securities and Exchange Commission (SEC) has filed a lawsuit against Kan King Wong and his wife, Charlotte Ka On Wong Leung.

The SEC alleged the couple engaged in "unlawful trading activity" ahead of News Corps' surprise 1 May offer for the US media firm.

The firm's shares rose 50% on the bid.

Assets frozen

The SEC, the New York Attorney General and the Securities and Exchange Commission are looking into trading patterns in share options ahead of the buyout offer.

In court documents, the SEC said the Hong Kong residents bought 415,000 shares of Dow Jones worth $15m between 13 April and 30 April.

The purchases occurred while they possessed "material non-public information" about the impending $60-a-share offer and would have seen Mr Wong and his wife net a gain of $8.18m.

The US court judge has temporarily frozen these assets, which were accumulated in a Merrill Lynch brokerage account, in response to a request from the SEC.

"Insider trading is a violation of both the law and Merrill Lynch policy and we co-operate fully with the authorities investigating suspected cases," a Merrill Lynch spokesman said.


SEE ALSO
Probe into Dow Jones share trade
08 May 07 |  Business
Dow Jones offer may spark bid war
02 May 07 |  Business
News Corp tables shock Dow offer
01 May 07 |  Business

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