The SEC charged 2 freight railway employees and 4 family members with perpetrating an insider trading scheme that garnered more than $1 million in illegal profits.  Gary Griffiths and Cliff Steffes allegedly learned confidential information in early 2007 about the upcoming acquisition of Florida East Coast Industries, which owned the freight railway where they worked in Jacksonville, FL.  They then tipped family members.  All told, traders collectively purchased more than $1.6mn in company stock and options ahead of the 5/8/07 announcement.

The SEC has charged the defendants with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder.  One of the relatives, Robert Steffes, has consented to a court order that would require him to $226,000 in disgorgement, prejudgment interest and penalties.   [SEC PR 10-178, 9/30]