United States Securities and Exchange Commission
Washington, DC
Litigation Release No. 17636 / July 30, 2002
SEC v. Arjun Sekhri, Amolak Sehgal, Pratima Rajan, Fuad Dow, Gordon W.
Cochrane, Martin L. Thifault, Rohina Sharma, and Sharad Kapoor, Defendants,
and Mahendar Sekhri And Sharda Sekhri, relief defendants, Civil Action No.
98 Civ. 2320 (S.D.N.Y.) (RPP)
Former Fugitive Investment Banker Ordered to Pay More than $9 Million for
Insider Trading
The Securities and Exchange Commission announced that on July 25,
2002, Judge Robert P. Patterson of the Southern District of New York
entered a final judgment granting the SEC's motion for summary
judgment against Arjun Sekhri, 37, an Indian national who formerly
worked as an investment banking associate at Salomon Smith Barney,
Inc. in New York City. Based on its findings, the Court permanently
enjoined Sekhri from future violations of Sections 10(b) and 14(e) of
the Securities Exchange Act of 1934 and Rules 10b-5 and 14e-3, and
ordered him to disgorge $957,892.55 in insider trading profits of the
individuals who traded based upon his tips. The SEC has already
recovered more than $1.6 million in disgorgement from other
defendants, and the amount that Sekhri has been ordered to disgorge
represents the remaining illegal profits that had not yet been
recovered in this action. Sekhri was also ordered to pay prejudgment
interest of $376,879.66, and to pay the maximum civil penalty of
$7,727,772.21, which is three times the total illegal profit of
$2,575,924.07 made by Sekhri's tippees.
The Court found that, between September 1997 and January 1998, Sekhri,
Amolak Sehgal, Pratima Rajan, Fuad Dow, Gordon W. Cochrane, Martin L.
Thifault, Rohina Sharma, Sharad Kapoor, and Sekhri's father, Mahendar
Sekhri, engaged in an insider trading scheme in which Sekhr's tips led
to trades by the individuals purchasing securities of MCI
Communications Corp., Brooks Fiber Properties, Inc., Carson Pirie
Scott & Co., Inc., Central and South West Corp., and Southern New
England Telecommunications Corp., in advance of six merger and
acquisition announcements involving these companies. Sekhri's repeated
tips of inside information to his tippees generated illegal profits of
approximately $2.5 million.
In January 1998, after learning that the SEC was investigating this
trading, Sekhri quickly fled the United States and traveled to India
to avoid prosecution. On April 1, 1998, the SEC charged Sekhri and
others with insider trading. The U.S. Attorney's Office for the
Southern District of New York later filed criminal charges against
SNIPPETS:
United States Securities and Exchange Commission
SEC v. Arjun Sekhri, Amolak Sehgal, Pratima Rajan, Fuad Dow, Gordon W. Cochrane, Martin L.
Former Fugitive Investment Banker Ordered to Pay More than $9 Million for Insider Trading
The Securities and Exchange Commission announced that on July 25, 2002, Judge Robert P.
Based on its findings, the Court permanently enjoined Sekhri from future violations of
The SEC has already recovered more than $1.6 million in disgorgement from other defendants,
The Court found that, between September 1997 and January 1998, Sekhri, Amolak Sehgal, Pratima
tions Corp., in advance of six merger and acquisition announcements involving these companies.
Sekhri's repeated tips of inside information to his tippees generated illegal profits of
In January 1998, after learning that the SEC was investigating this trading, Sekhri quickly
The U.S. Attorney's Office for the Southern District of New York later filed criminal charges
In imposing the maximum civil penalty allowable, the Court observed that Sekhri "held one of
The SEC's litigation in this case continues against the remaining defendants.
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