OSC: Duo Profited From Inside Information About KKR Deal

Sep 27 2010 | 2:29pm ET

Regulators have accused a pair of Canadian stockbrokers of profiting on insider information about an acquisition by Kohlberg Kravis Roberts.

The Ontario Securities Commission allege that Howard Miller and Man Kin Cheng, both formerly of TD Waterhouse Canada, pushed family members and clients to buy shares of Masonite International after learning that the door manufacturer had negotiated a deal to be acquired by a KKR unit six years ago.

According to the regulator, an e-mail sent by Miller to a client on Nov. 24, 2004, proves that the duo were trading on confidential information. The OSC said Miller told the client that a “cash takeover of $40” was imminent at Masonite, likely “before Xmas but you never know with lawyers.” In fact, the deal was announced three days before Christmas.

In the interim, Miller, Cheng, their families and clients bought up C$2.35 million worth of Masonite shares. The OSC said Miller turned an illegal profit of C$53,500, while Cheng and his family earned C$58,300.

The OSC did not explain how Miller had come into the information, except to say that he learned about it from someone he knew.

There is a hearing scheduled for Oct. 18.


In Depth

Q&A: Fund Administration Comes To The Cloud

Jul 14 2017 | 7:23pm ET

The fund administration sector has been steadily implementing new technology, such...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

Rastegar: PE Real Estate Gains Momentum as Uncertainty Rises

Jul 21 2017 | 6:04pm ET

The steady march of equity markets and fundamental shift in the direction of Fed...

 
Error

FINalternatives Trending

From the current issue of