BANGKOK (AP) -- The U.S. Securities and Exchange Commission says a Thai plastics company employee made profits of $3.2 million by trading on inside knowledge that a takeover offer for Smithfield Foods was imminent.
A U.S. court has frozen the American brokerage account of 30-year-old Badin Rungruangnavarat so the trading profits can't be transferred overseas.
U.S. pork producer Smithfield announced a $4.7 billion takeover by Chinese meat company Shuanghui in late May.
The SEC alleges in a court filing this week that Rungruangnavarat cornered the market in Smithfield options and futures in the days before the takeover as well as buying Smithfield stock.
It said Charoen Pokphand Foods, a Thai conglomerate, was also considering a bid for Smithfield and an associate director of a Thai investment bank advising Charoen was Facebook friends with Rungruangnavarat. The banker had previously worked with Rungruangnavarat at the plastics company.
The SEC said the investment bank had access to a data room that Smithfield established for potential buyers to inspect its finances.