Two Houston-area men, Balajj Sundarraj of Sugar Land and David O’Brien of Houston, have agreed to pay fines and penalties to settle allegations by the SEC of insider trading.
Mr Sundarraj owns and operates a company that supplies directional drilling products. Mr O’Brien is a purchasing manager in the oil and gas industry.
According to the SEC, Mr Sundarraj’s brother-in-law was an associate lawyer at a law firm engaged by Oracle to perform legal due diligence. The brother-in-law worked from his home in Sugar Land and took steps to make sure his work remained confidential.
In April 2016, the brother-in-law was on a conference call discussing Oracle’s proposed acquisition of Opower. Mr Sundarraj was in an adjacent room and overheard details. He then told Mr O’Brien about the call. So, after researching the company on library computers, they each purchased shares of Opower.
In late April, Mr Sundarraj bought 5,000 shares for $39,359, while Mr O’Brien bought 8,858 shares for $68,729. On May 2, Oracle announced it would buy Opower. The same day, Sundarraj and O’Brien sold all their shares, realizing gains of $12,050 and $22,900 respectively.
Without admitting or denying the findings, Sundarraj agreed to pay disgorgement of $12,050, interest of $1,650 and a penalty of $34.950. O’Brien agreed to pay disgorgement of $22,900, interest of $3,137 and a penalty of $22,900.