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Insider Trading: Ex-Coca Cola Executive
March 9, 2012
The SEC Thursday charged a former executive at a Coca-Cola bottling company with insider trading based on confidential information he learned on the job about potential upcoming business with The Coca-Cola Company.
SEC Findings and Allegations. Steven Harrold, a Vice President at Coca-Cola Enterprises Inc., bought company stock in his wife’s brokerage account after learning that his company had agreed to acquire The Coca-Cola Company’s bottling operations in Norway and Sweden. The news announcement caused the share price to jump 30%, enabling Harrold to pocket $87K in illicit profits. Shares of the bottler/distributor trade - Coca-Cola Enterprises (CCE) - trade on the NYSE.
Harrold was regularly in possession of sensitive, confidential information as an executive at CCE, and on numerous occasions, he signed non-disclosure agreements requiring him to keep confidential any information he learned about acquisitions being considered. He also periodically received blackout notices prohibiting him from trading in company stock for a defined period in which he was likely to be in possession of confidential information.
Harrold, who lives in Los Angeles and London, learned of the deal in early January 2010 and purchased 15,000 shares on 2/24/10 - the day before the announcement.
The SEC seeks disgorgement of Harrold's illicit gains, plus prejudgment interest and a financial penalty. FINRA assisted the SEC in this case.
For further details, go to: [SEC PR 12-40, 3/8/12] and [SEC Complaint].

