You & Us. Already in trouble for allegedly helping rich people avoid taxes and screwing over clients with auction rate securities, UBS hits the headlines again--this time for insider trading. Did the company advise clients to scoop up call options on DRS Technologies and American Power Conversion just before they announced takeover deals?
DealBook: Federal regulators filed insider trading charges on Friday against unidentified individuals who are accused of making suspiciously well-timed purchases of call options in two companies before they announced multibillion-dollar mergers.
The case was brought in Federal District Court in New York against “one or more unknown purchasers” of call option contracts to buy shares of the military contractor DRS Technologies and American Power Conversion, a power and cooling services company.
DRS is in a pending deal to be acquired for $3.94 billion by Finmeccanica of Italy; American Power was bought by the French engineering group Schneider Electric for $6.1 billion last year.
Through an account at UBS in Zurich, the buyers made “well-timed purchases” of call options of DRS and American Power that yielded profits of about $3.3 million, the Securities and Exchange Commission said.
See Also:
Mass AG: UBS Stuffed Clients Full Of Auction Rate Securities Just To Get Them Off Books
UBS to Execs: Don't Go To US...Because You Might Get Arrested
