SEC charges Kuwaiti trader with Citigroup connection in scheme to make millions off hoaxes
By APFriday, July 24, 2009
SEC charges Kuwaiti trader with hoax scheme
WASHINGTON D.C. — The Securities and Exchange Commission on Thursday charged a Kuwaiti trader connected with Citigroup with scheming to make millions off fake offers to acquire U.S. companies.
The SEC is freezing more than $5 million in trading profits in the name of Hazem Khalid Al-Braikan and three companies he is associated with: United Gulf Bank, KIPCO Asset Management Co. and Al-Raya Investment Co.
New York-based Citigroup Inc. holds a 10 percent stake in Al-Raya Investment Co.
The SEC says Al-Braikan and the three companies traded on two phony announcements faxed to news organizations. One on Sunday stated that a Middle Eastern investment group made an offer to acquire Stamford, Conn.-based electronic systems maker Harman International Industries Inc. A similar incident occurred in April with Providence, R.I.-based conglomerate Textron Inc.
The hoax offers caused the companies’ shares to spike.
A Citigroup spokesperson says the bank has no comment on the SEC’s action.
