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Silicon Valley exec pays SEC insider trading fine for tip-off to brothers
[NEW YORK] The US Securities and Exchange Commission said a former senior executive at Qualys Inc will pay a US$581,170 insider trading penalty for helping his brothers sell their shares in the Silicon Valley company after learning it would report disappointing revenue.
Amer Deeba, 51, who resigned this month as Qualys' chief commercial officer, was accused of telling his two brothers in April 2015 that the cloud security company had missed its first-quarter sales forecast, and arranging for their broker to sell their shares.
The SEC said Deeba's brothers, both Lebanese citizens, avoided US$581,170 of losses by selling their shares before Qualys revealed the shortfall and cut its full-year revenue forecast on May 4, 2015. Qualys' share price shed 33 per cent of its value the next day.
"We announced the bad news today," Mr Deeba, then Qualys' vice president of corporate development and strategic alliances, texted his younger brother after the Foster City, California-based company revealed its disappointing results.
The SEC said Deeba also accepted a two-year officer and director ban, and did not admit or deny wrongdoing.
It also said Deeba had worked at Qualys from 2001 to 2018, and been an "important member" of its leadership.
"Corporate officers must safeguard their company's confidential information even if it might hurt them or their family financially," Jina Choi, director of the SEC's regional office in San Francisco, said in a statement.
Lawyers for Mr Deeba did not immediately respond to a request for comment. Mr Qualys did not immediately respond to similar requests.
The company and Mr Deeba's brothers, an engineer living in Abu Dhabi and a doctor living in Beirut, were not charged.