Mavs' Cuban charged with insider trading
Sports Network | November 17, 2008
Dallas, TX (Sports Network) - Dallas Mavericks billionaire owner Mark Cuban has been charged with insider trading by the Securities and Exchange Commission.
The outspoken and controversial Cuban, who made his fortune as an Internet entrepreneur, is being targeted for illegal trading of Mamma.com stock.
The SEC is alleging that Cuban began selling his six percent ownership stake in the company on June 28, 2004, after learning that Mamma.com was raising money through a private investment in a public entity, or PIPE.
The next day, the company announced the PIPE financing and shares of the company dropped by more than 10 percent.
According to the complaint, the SEC has alleged Cuban was aware the shares would be sold below market price, and ordered his broker to sell all shares in the search engine company. By selling his stake before the public announcement, the SEC said Cuban avoided more than $750,000 in losses.
The SEC is seeking to prohibit Cuban from engaging in future violations of the antifraud provisions of the federal securities laws; ordering him to disgorge, with prejudgment interest, any losses avoided as a result of his actions; and ordering Cuban to pay a civil money penalty.
The 50-year-old Cuban owns the Mavericks, HDNet, a national high-definition television network, and Landmark Theaters. He has also been rumored to be interested in purchasing a stake in Major League Baseball's Chicago Cubs.
