The U.S. Securities and Exchange Commission obtained a court order Tuesday to freeze the assets of a China-based trader over what it called suspicious activity ahead of a $9 billion buyout offer for a U.S.-listed Chinese Internet company last week.
Haijian Luo, chief executive of a Chinese online company, 4399 Co., bought approximately $700,000 of out-of-the-money call options, or bets that the stock price of a company will go up, before last week’s announcement of a buyout offer for Qihoo 360 Technology Co., according to a news release from the SEC. A person at Mr. Luo’s company said she didn’t know how to reach him.
Mr. Luo made more than $1 million from the bets and requested his brokerage firm transfer more than half of the proceeds to a foreign bank account, the regulator said.
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