Two Hong Kong-based asset-management firms agreed to pay about $11 million to settle U.S. regulatory claims related to improper trades made before China-based Cnooc Ltd. said it would acquire Canadian energy firm Nexen Inc.
Citic Securities International Investment Management HK Ltd. and China Shenghai Investment Management Ltd. were the last two firms holding assets that were the subject of a 2012 Securities and Exchange Commission probe of illegal trades ahead of the merger announcement, the agency said in a statement yesterday. The SEC has collected almost $30 million in illicit profits and penalties in the case.
“The SEC’s swift action in this case ensured that traders located on the other side of the globe were not only deprived of their illegal insider trading profits but eventually paid steep penalties,” Sanjay Wadhwa, senior associate director in the SEC’s regional office in New York, said in a statement.
Citic Securities agreed to pay $6.6 million for purchasing shares of Nexen stock in the U.S. for the accounts of two of its affiliates, the SEC said. China Shenghai will pay $4.3 million in disgorgement of illicit profits by the firm and eight clients, according to the statement. In settling the claims, the firms didn’t admit or deny wrongdoing.
Citic Securities “has cooperated with the SEC and is pleased to have this matter resolved,” Robert Giuffra, an attorney for Citic Securities, said in an e-mail. Marc Litt, a lawyer representing China Shenghai, didn’t immediately return a phone call seeking comment.
Nexen’s stock rose more than 50 percent on July 23, 2012, after Cnooc, China’s largest offshore oil and gas explorer, said it would pay $15.1 billion in cash to acquire the Calgary-based company.
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