(CN) - Two businessmen in China and Hong Kong will pay $920,000 to settle an insider trading case involving health care stocks, the government said.
Zhichen Zhou and Yannan Liu are cousins and business associates, according to the U.S. Securities and Exchange Commission. An SEC complaint filed last month accused them of trading stocks of two health care companies based on non-public information about impending acquisitions.
Liu worked as a private equity associate at TPG Capital, which had ties to deals involving both of the health care companies, MedAssets Inc. and Chindex International, according to the SEC.
Liu allegedly tipped off Zhou, who reportedly bought nearly 40,000 shares of MedAssets stock and more than 3,000 Chindex shares prior to acquisition announcements that caused each stock to rise.
The cousins will repay their ill-gotten profits of $306,929 and they will each also pay a penalty in the same amount, for a total of $920,788. The SEC announced the deal Monday.
Zhou lives in Beijing and Liu lives in Hong Kong, according to the government. Their assets were frozen last month by an emergency court order.
They settled the charges against them without admitting or denying the allegations, the SEC said.
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