MANHATTAN (CN) – Brokerage accounts that profited by $29 million after Comcast acquired DreamWorks Animation last year are on hold after the Securities and Exchange Commission brought federal inside trading charges.
Weeks before news of the April 2016 acquisition became public, according to the Feb. 10 complaint, Chinese national Shaohua (Michael) Yin amassed more than $56 million of DreamWorks stock in various U.S. brokerage accounts, some of which belonged to his elderly parents.
Shares of DreamWorks rose 47.3 percent once its acquisition by Comcast was announced, and the SEC says the five accounts Yin used to buy stock reaped $29 million.
In a statement on the case, the SEC notes that it has also alleged that “the accounts profited from other suspicious trading in another U.S.-based company and three China-based companies ahead of market-moving news.”
The SEC describes Yin as a partner at Summitview Capital Management Ltd., a private equity firm in Hong Kong.
Rather than trade in DreamWorks stock through his own account, Yin allegedly “traded through five accounts from addresses in Beijing and Palo Alto and on a computer that also accessed Yin’s email accounts,” according to the SEC’s statement.
U.S. District Judge J. Paul Oetken in Manhattan issued an asset freeze Friday on the five brokerage accounts. There will be hearing on the case Feb. 17.
In addition to Yin, who is charged with securities fraud, the complaint demands relief from the holders of the five brokerage accounts: Lizhao Su, Zhiqing Yin, Jun Qin, Yan Zhou and Bei Xie. The SEC seeks a permanent injunction, penalties and the return of ill-gotten profits, among other relief.Follow @bleonardcns
Read the Top 8
Sign up for the Top 8, a roundup of the day's top stories delivered directly to your inbox Monday through Friday.