Recently I blogged about the SEC freezing assets in connection with the acquisition of Nexen by Chinese energy company CNOOC Limited (“CNOOC”). In late July 2012, the SEC filed a complaint alleging that Hong Kong-based Well Advantage Limited and other unknown traders had traded Nexen stock based on nonpublic information about CNOOC’s impending acquisition of Nexen and made than $13 million in illegal trading profits. The SEC obtained a court order freezing the assets of the initial defendants valued at more than $38 million.
On Friday, August 3, 2012, the SEC filed an amended complaint adding allegations that additional unknown traders in possession of inside information purchased Nexen stock in the days leading up to the public announcement of its acquisition. The additional unknown traders opened a brokerage account through Hong Kong-based CSI Capital Management Limited and bought 250,000 shares of Nexen stock. After the announcement, the traders sold their shares for nearly $6.5 million, making about $2.3 million in illegal profits. The SEC also obtained another emergency court order freezing nearly $6.5 million in the assets of these additional traders.