Feb. 11 (UPI) -- The Securities and Exchange Commission charged a Chinese investor with insider trading in Comcast's acquisition of DreamWorks Animation.
United States regulators froze brokerage accounts used by Shaohua "Michael" Yin that contained $29 million in profits he allegedly gained by illegally trading DreamWorks shares.
According to the lawsuit, Yin, 44, bought $56 million in DreamWorks stock using five brokerage accounts in the weeks before Comcast announced its plans to take over the animation studio.
The shares were then sold after DreamWorks stock rose 47 percent between April 26, when news of the takeover was first reported, and April 28 when it was formally announced.
Yin attempted to hide the trading by using accounts in the names of his elderly parents, and other who had ever previously held any shares of DreamWorks.
"Placed in context, the purchases by these five individual trading accounts -- nominally owned by two elderly retirees, an electrical company employee, a teacher and a natural resources manager -- accounted for 16.9 percent of all market trading in DreamWorks," the lawsuit stated.
The SEC alleged that Yin, who works for works for Summitview Capital Management Ltd. in Hong Kong and maintains a residence in Palo Alto, Calif., has made illegal trades of stock of other companies, as well.
The FBI executed a search warrant on Yin at the San Jose International Airport on Feb. 3 before a flight to China and the SEC is seeking a return of the ill-gotten funds in addition to a permanent injunction on Yin's trading and other penalties.
"Despite the defendant's alleged attempts to hide his control over these accounts, the SEC's data analytic investigative tools enabled us to determine who was behind the suspicious trading," Michele Wein Layne, head of the SEC's Los Angeles office said.