SEC: FOREIGN TRADERS AGREE TO PAY $3.3 MILLION IN SETTLEMENT

(The following is a reformatted version of a press release
issued by The U.S. Securities and Exchange Commission and
received via electronic mail. The release was confirmed by the
sender.) 
FOREIGN TRADERS AGREE TO PAY $3.3 MILLION TO SETTLE CHARGES IN
NEXEN INSIDER TRADING CASE 
Washington, D.C., March 29, 2013 - The Securities and Exchange
Commission today announced that a Chinese businessman and his
wife whose trading accounts were frozen last year as part of a
major insider trading case have agreed to settle charges that
they loaded up on the securities of Nexen Inc. while in
possession of nonpublic information about an impending
announcement that the company was being acquired by China-based
CNOOC Ltd. 
The SEC obtained an emergency court order in July 2012 to freeze
multiple Hong Kong and Singapore-based trading accounts just
days after the Nexen acquisition was announced and suspicious
trading in Nexen stock was detected.  The SEC’s complaint
alleged that in the days leading up to the announcement, Hong
Kong-based firm Well Advantage Limited and other unknown traders
purchased Nexen stock based on confidential details about the
acquisition. 
The SEC’s investigation has identified Ren Feng and his wife
Zeng Huiyu as previously unknown traders charged in the
complaint as well as Ren’s private investment company CT Prime
Assets Limited and four of Zeng’s brokerage customers on whose
behalf she traded.  They made a combined $2.3 million in illegal
profits from Nexen stock trades made by Ren and Zeng. 
The settlement, which is subject to court approval, requires the
traders to pay more than $3.3 million combined. 
“This settlement requires full disgorgement of the insider
trading profits of this group of foreign traders, and Ren and
Zeng must additionally pay sizeable penalties,” said Sanjay
Wadhwa, Senior Associate Director of the SEC’s New York Regional
Office.  “This should send a stern warning to anyone
contemplating insider trading in U.S. markets from abroad that
the SEC uncovers such misconduct and the end result is a severe
financial setback rather than a windfall.” 
In October 2012, the SEC announced a settlement with Well
Advantage, which agreed to pay more than $14.2 million to settle
the insider trading charges.  U.S. District Court Judge Richard
J. Sullivan of the Southern District of New York approved that
settlement. 
This proposed settlement with Ren, Zeng, and the others also
must be approved by Judge Sullivan. 
Ren and CT Prime agreed to the entry of a final judgment
requiring them to jointly pay disgorgement of their ill-gotten
gains of $839,714.57 plus a penalty of $839,714.57, and
permanently enjoining them from future violations of Section
10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. 
Zeng agreed to the entry of a final judgment requiring her to
pay disgorgement of her ill-gotten gains of $202,030.22 plus a
penalty of $202,030.22, and permanently enjoining her from
future violations of Section 10(b) of the Exchange Act and Rule
10b-5. 
Zeng also traded on behalf of four of her brokerage customers,
who have agreed to disgorgement of the ill-gotten gains.  Wong
Chi Yu and her company Giant East Investments Limited agreed to
jointly pay disgorgement of $641,057.94.  Wang Wei agreed to pay
disgorgement of $137,369.56.  Wang Zhi Hua agreed to pay
disgorgement of $466,169.15. 
The defendants neither admit nor deny the SEC’s allegations. 
The SEC’s investigation, which is continuing, has been conducted
by Simona Suh, Charles D. Riely, Michael P. Holland, and Joseph
G. Sansone of the Market Abuse Unit as well as Elzbieta Wraga
and Aaron Arnzen of the New York Regional Office.  The case has
been supervised by Daniel M. Hawke and Sanjay Wadhwa.  The SEC
appreciates the assistance of the Hong Kong Securities and
Futures Commission and the Financial Industry Regulatory
Authority (FINRA). 
Contact: SEC Office of Public Affairs - 202-551-4120 
Web version: http://www.sec.gov/news/press/2013/2013-50.htm 
The SEC’s previously filed complaint against unknown traders is
available at: 
http://www.sec.gov/litigation/complaints/2012/comp-pr2012-145.pdf 
Defense Counsel: Randall Fons at Morrison & Foerster LLP in
Denver - 303-592-2257 
(bjh) NY 
#<873920.660640.3.4.1.0.76>#
 
 
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